Legislation

Mexico – New tax regime will bring investment says AIEJA

By Phil - 22 March 2019

The President of the Mexican Gaming Association (AIEJA) Miguel Angel Ochoa Sanchez has reiterated his support for new rules which would change taxes on the industry in Mexico.

Mr. Ochoa said that new taxes at a federal level would lead to more certainty for national and foreign investors which will in turn lead to greater foreign investment and more jobs.

“The three proposals put forward by the National Regeneration Movement (MORENA) in the Chamber of Deputies and the Senate we like because it is something that we have been asking for more than ten years, since there are currently three tax regimes for the sector: one that is charged by the government at the federal level, another on a state level and a third via the municipalities, ” he said in an interview with news local news service Notimex. He said that these charges generated a lot of confusion and uncertainty since each state levies its own taxes. In addition taxes on the industry have increased significantly on a local level where local authorities and the municipal governments, “are inventing taxes, which do not even exist globally”

The new taxes would give more control to the federal government which in turn would reap a much more significant amount of taxes. “The three proposals speak of establishing a more appropriate regime for the sector, none of the three defines the how but what it does define is giving a special regime to the sector . . . the three proposals eliminate the collection of taxes to the states and to the municipalities, the whole federation charges and distributes a small percentage to the states and municipalities,” he said.

Mr. Ochoa said the industry wanted an even playing field and, that they be charged fairly, since that “would generate greater certainty to domestic and foreign investors when it comes to knowing clearly how much they will pay in taxes when they decide to enter this sector.”

Mr. Ochoa went onto say that the taxes set on a local level “break the stability of the investment, they create uncertainty and that prevents strong investments from coming to the national economy in this sector,” he said.

He also argued that by increasing certainty when it came to investment, the number of gambling establishments could double during the current Presidential term especially as gambling becomes more popular as an entertainment option.

Senators belonging to the left wing party the National Regeneration Movement (MORENA) have put forward an initiative to increase taxes on gambling and change online gambling rules. The new law also seeks to give the central government more say when it comes to establishing tax rates over the industry.

Caption: Miguel Angel Ochoa Sanchez