Mexican Casinos call on federal intervention to end fragmented tax policies

AIEJA – Mexico’s casino trade association – has urged the federal government to intervene and implement a unified tax framework for casinos to operate under.

The association that represents land-based casino operators, games suppliers and licence holders outlined that its members supported ‘single tax payment system to help improve control over income’.

At present, Mexico operates a fragmented regulatory framework for casino operators in which licences are permitted by government authorisation, but taxation remains subject to individual policies of state municipalities.   

According to AIEJA President Miguel Ángel Ochoa, the current framework has “strangled the industry”, whose income has provided limited benefits to municipalities, as well as the funding of federal and state coffers.

Calling for federal intervention, Ochoa outlined: “In general, taxes fiscally strangle this industry and indirectly promote clandestine and illegal gambling. They also alienate investments, so we welcome a measure to boost the economy.”

AIEJA’s President reported that prior to the COVID-19  pandemic, 384 operating gaming halls had contributed circa $251m to the Treasury whilst providing $126m to Mexican states and local municipalities.

Currently Mexico’s casino sector is in a state of limbo, as venues wait upon individual government orders to reopen their businesses post COVID-19 pandemic.

Under President Andrés Manuel López Obrador‘s direct orders, the federal government is currently not granting new authorizations to open gambling halls.

At stands there are a total of 284 open gambling venues; however, Mexico’s 36 authorized businesses have the rights to open up to 754 casinos in total, but only if restrictions are lifted.

Back in January, AIEJA reported that the casino activity in Mexico was “close to three-quarters of the volume it had before the pandemic” which forced authorized venues to close for more than a year.

 Local developments saw the state of Mexico DF recover 75% of its casino activity and jobs lost during the pandemic. However, states like Chihuahua were forced to close again or reintroduce restrictive measures at the beginning of the year as new guidelines were introduced to fight the pandemic in the country.

 

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