The regulated gambling industry in Mexico faces one of its greatest challenges in recent years. Starting January 1, 2026, operators in the sector must assume a 50% tax rate on gross gaming revenue (GGR), approved by the Mexican government in its tax reform package for that year. The measure, which represents a substantial increase compared to the previous scheme, has raised alarms within the sector, which warns of consequences that go beyond the direct economic impact on companies.
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AIEJA’s alert: a direct blow to regulated gambling
Miguel Ángel Ochoa Sánchez, president of the Mexican Association of Permit Holders, Operators and Suppliers of the Entertainment and Gambling Industry (AIEJA), described the measure as a “hard blow” for the sector in recent statements to a specialized media outlet. Ochoa pointed out that the increase is not an isolated event, but part of a regional trend that puts the viability of legal gambling in Latin America at risk.
According to the leader, the main risk of this trend towards higher tax burdens in the industry is that it ends up benefiting the illegal market to the detriment of legally established operators. When taxes are raised disproportionately, players migrate to unregulated platforms that offer better economic conditions but no guarantee of safety for the user. The result is a fiscal paradox: the State collects less as it raises taxes because the tax base contracts.
Why a higher tax can mean lower revenue
The logic behind Ochoa’s warning is clear from an economic point of view. When the tax burden on legal operators exceeds a certain threshold, they pass part of the cost on to the player in the form of worse odds and lower bonuses. This creates a direct incentive for users to seek alternatives in the unregulated market, where illegal platforms do not pay taxes, are not subject to responsible gambling controls, and do not offer consumer protection mechanisms.
The net effect is that the public treasury loses revenue on two fronts: legal operators generate less taxable GGR and players who migrate to the black market stop contributing entirely to the tax system. This dynamic, already observed in other markets that raised their rates abruptly, reinforces the arguments in favor of a calibrated tax policy that prioritizes channeling towards regulated gambling.
The AIEJA leader recognizes that the online sector continues to grow rapidly and that expansion prospects are solid, even in an environment of increased fiscal pressure.
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A determining factor in this optimistic vision is the 2026 FIFA World Cup, in which Mexico is a co-host country along with the United States and Canada. According to Ochoa, the tournament represents a generational opportunity for the sports betting market in the country. Sector projections anticipate a significant increase in the volume of bettors during the tournament and, what is even more relevant from a commercial point of view, an improvement in player retention in the medium term.
Mexico on the international radar: market data and global position
The data supports this optimism. According to the most recent figures from H2 Gambling Capital, Mexico ranks eighteenth among the world’s largest gambling markets, with a gross profit of $5.680 billion in 2024. It is a market of relevant scale that attracts the interest of operators and technology providers globally.
Among the players betting on the Mexican potential is Playtech, one of the sector’s leading technology providers, which in its recent fiscal year 2025 results highlighted the performance of the Latin American market and the expected catalytic effect of the World Cup. Chris McGinnis, CFO and CEO of the company, noted that the operator Caliente, with whom Playtech maintains a commercial agreement in Mexico, continues to show good performance. McGinnis anticipated an additional boost during the 2026 World Cup, an event that, in his own words, will significantly increase visibility, participation, and betting volume in the country.
The underlying debate: how to design a tax policy that does not discourage legal gambling
The Mexican case highlights a debate that is repeated in multiple Latin American jurisdictions: the tension between the governments’ need to increase revenue and the importance of maintaining conditions that make regulated gambling competitive against illegal offerings. An effective tax policy in this sector cannot be evaluated solely by the nominal rate it sets, but by its real impact on channeling and on the total revenue generated by the legal market. International experience suggests that the most successful taxation models combine reasonable rates with solid regulatory frameworks that favor transparency and player protection. Mexico’s bet on a 50% rate on GGR tests this equation in one of the markets with the greatest projection in the region.
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