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Mexico – Mexican state of Sonora proposes new tax on players

By - 21 November 2018

The state of Sonora, located in the northwest region of Mexico, is analysing charging a tax on bets made in casinos. The proceeds will be destined to an addiction prevention fund.

The plan to include the new tax was announced by the Secretary of the Treasury, Raúl Navarro Gallegos, as part of the Expenditures Budget and Income Law Project for fiscal year 2019. “The reform is on its way where we intend a new tax which will tax those who bet in the casinos, it is a proposal that the executive is making and we intend, by means of a collection to those who bet, a tax rate for betting,” said the state official. While the government has not yet revealed the exact details of the new tax, the intention is to raise around $100m for the newly created fund.

The move would affect casinos such as Casino Caliente, Winpot Nogales,Big Bola Casino, Casino Life, Casino Palermo, Casino Erion, Sahara Casino and Hermosillo Downtown Casinos.

If approved the state will join a number of other states, which now tax player winnings. Nuevo León has applied a tax on player winnings for two years now while other states such as Aguascalientes are considering a new 10 per cent charge on players for 2019. In August according to the Financial Report for the second quarter of 2018 sent by the State Treasury to Parliament, gaming tax revenue was up by 84.7 per cent in the state of Nuevo Leon adding up to $446m. In all the total tax revenues of the government of Nuevo León, corresponding to the second quarter of 2018 amounted to $54,560m, 3.3 per cent more than that was recorded in the same period last year.

Earlier this month officials for the state of Nuevo León revealed that taxes generated from casinos increased by 40 per cent during the third quarter of 2018 compared to the same period in 2017. Taxes on prizes on casinos and other betting such as lotteries and raffles was key in increased revenues for the state. As a result other states could well look to follow suit in the future.

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