Mexico’s 50% GGR tax hike risks driving growth in the black market, the country’s leading trade body has warned.
As of 1 January this year, operators in Mexico face an increased tax burden after the government approved a 50% rate on GGR in a 2026 fiscal reform package.
Miguel Ángel Ochoa Sánchez, president of the Mexican Association for Permit Holders, Operators and Suppliers of the Entertainment and Gambling Industry (AIEJA), said it came as a “blow” to the industry, in a recent interview with iGB.
He warns the hike reflected a wider theme in the LatAm region, to rates that ultimately come as a detriment to channelisation to legal offerings.
“I believe the main danger of these trends toward increased taxes on the industry, which many Latin American governments are adopting, is that they ultimately harm legally established industries to the benefit of the illegal market,” Ochoa tells iGB.
“And in the end, besides hurting businesses in the sector, governments collect less tax revenue by raising taxes, encouraging a significant migration of players to platforms that not only fail to contribute to our national treasuries but also offer no security whatsoever for customers.”
Mexico market still an attractive one
Despite Ochoa’s warnings against the tax hike, he still holds an optimistic outlook for the market.
Mexico is co-hosting the upcoming Fifa World Cup football tournament and Ochoa believes this will provide a big opportunity for its gambling market.
“The market continues to grow rapidly and the outlook remains very positive,” Ochoa adds.
“With the arrival of the 2026 World Cup, projections indicate a substantial increase not only in the volume of bettors but also in player retention in the medium term.
“Therefore, I would put into perspective the impact of this tax increase on the momentum of the online sector.”
According to the latest data from H2 Gambling Capital, Mexico is its 18th biggest market with a gross win in 2024 of $5.68 billion.
Playtech was also bullish on Mexico in its recent FY25 earnings, stating it expects an uptick in its Americas region thanks to the World Cup.
Playtech holds an agreement with Mexico-facing operator Caliente, with CFO and director Chris McGinnis saying on the company’s post-FY25 earnings call: “In Mexico, Caliente continues to perform strongly, and we expect to see a further uplift from the 2026 Fifa World Cup, where Mexico is a co-host nation and the games will be on a local time zone.
“This is a once-in-a-generation event that will significantly boost visibility, engagement and betting volumes.”
Kyle Goldsmith
Kyle has been with Clarion since December 2023, joining from the world of sports journalism, subsequently becoming a LatAm-facing senior reporter with iGB.
Original article: https://igamingbusiness.com/finance/tax/mexico-gambling-trade-body-illegal-market-tax-hike/
