Mexico's Senate approves increase of taxes on online gambling from 30% to 50%

The Mexican Senate has approved a fiscal package for 2026, featuring a reform to the Special Tax on Production and Services (IEPS) Law, raising the tax on online gambling in the country from 30% to 50%. The bill had already been approved by the Lower House two weeks ago.

According to the approved proposal, the increase in taxes on online betting was made with the intention of "contributing to the fight against money laundering, requiring taxpayers to make their income transparent, and reducing opportunities for illicit operations."

In the case of the IEPS, the upper house supported the bill in general with 75 votes in favor and 37 against, and in particular with 76 votes in favor and 34 against. After the vote, the Board of Directors referred the ruling to the Executive branch.

As a result of this fiscal reform, the Ministry of Finance expects to collect MXN 761.5 billion (more than USD 40 billion) in 2026, which represents a 10% increase compared to the estimate for 2025. Part of the funds obtained from these measures will be allocated to health programs.

Other sectors affected by the increases include tobacco, flavored beverages, video games with violent content, and services such as immigration procedures, issuance of phytosanitary certificates, and use of the radioelectric spectrum.

During the debate, the President of the Senate, Laura Itzel Castillo, defended the reforms as part of a vision of "fiscal responsibility with social justice." The opposition, led by the PAN and the PRI, expressed their rejection of the proposals.

Threat to the sector

Experts warned that with the increase in the IEPS from 30% to 50% on online gambling, the Tax Administration Service (SAT) could lose MXN 12 billion (USD 650 million), taking into account projections of market growth.

According to legal sources consulted by the newspaper Milenio, the opportunity for revenue collection would be lost, causing legal operators to leave and encouraging the black market.

"The measure seems to be an incentive for bettors and players who currently use platforms authorized by the Ministry of the Interior to flee due to the increased cost of these bets, towards the growing illegal gambling market," stated tax lawyers from the firm Lazcano and Avedillo.

It is estimated that, conservatively, 60% of the total online betting available to Mexican players today is illegal. "Raising the tax could force legally established licensees to reconsider their business models," they added.