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Legislation

Mexico – New tax on gambling in Baja California will see tax income soar

By - 12 December 2019

The Congress of the State of Baja California has approved a new tax on gambling. The new measure was passed by 15 votes in favour and 2 against. The new state tax will take effect on January 1, 2020 and was put forward by Governor Jaime Bonilla Valdez.

During the session Deputy David Ruvalcaba warned that controversy could be generated because there is already a federal tax on gaming, and stressed that there had not been enough time to review the new legislation properly and therefore voted against it. Eva María Vásquez Hernández also argued that more time was needed to study some aspects of the new law and also voted no.

However the new tax will mean a windfall for the state. Baja California has the most casinos in the country. Of the 344 casinos that exist throughout Mexico, 44 casinos, 12 per cent are located in Baja California. Up until now tax collection has been very low, standing at just 144,000 pesos per month. The tax charges to casinos in Baja California could increase to as much as 1.1bn pesos a year, an amount 900 times larger than the amount generated before the amendment to the Baja California Treasury Law.

Additional taxes also now look likely in Mexico City. Recently Claudia Sheinbaum Pardo, head of the government of Mexico City, announced that the government plans to impose a new tax on casinos and other betting establishments where gambling is carried out, through the Income Law of 2020. According to the project, which must be processed and approved by the city Congress, the government will impose an additional 10 per cent tax on gambling establishments.

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