Codere Online is preparing for the impact of potential fiscal reforms in Mexico, Colombia, and Argentina, as these nations consider significant tax increases on the gaming sector. With Mexico proposing to raise the gaming tax to 50 percent of gross gaming revenue (GGR) by 2026, Colombia imposing a 19 percent VAT on deposits, and Buenos Aires deliberating additional levies, Codere Online’s CEO Aviv Sher shares the company’s strategic outlook in an exclusive interview with Focus Gaming News. Sher emphasizes the need for predictable and balanced tax frameworks to ensure market sustainability and consumer protection.
In Mexico, where the gaming tax is set to increase from 30 to 50 percent of GGR for both online and land-based betting, Codere faces a substantial challenge. Sher notes that while the company supports a regulated market with clear and predictable policies, this tax hike represents a significant shift. “We won’t speculate on specific outcomes while the process is ongoing,” he states, acknowledging the impact this will have on their investment strategies in Mexico. Codere is considering various initiatives to mitigate these effects, focusing on maintaining profitability and a competitive edge in the market.
In Colombia, the government has already enacted a 19 percent VAT on games of chance as of February, with discussions underway about extending this into the following year. Sher expresses understanding of the government’s fiscal objectives but warns against the unintended consequences of such abrupt tax increases. He argues that these measures could pressure the regulated market’s economics and inadvertently benefit unlicensed operators. Codere’s strategy has been to adjust promotional tools, marketing mixes, and operating costs to prevent losses, a plan that may continue if the tax persists into the next year.
In Buenos Aires, the debate over potential tax increases of up to 15 percent for slot machines, casinos, and online gaming presents another challenge. Codere, which operates only within the City of Buenos Aires, is less affected due to its limited market presence there. Nevertheless, Sher outlines a familiar strategy: operational efficiencies, optimizing marketing investments, and leveraging CRM capabilities to maintain customer preference for regulated offerings.
Codere’s omnichannel strategy, which integrates physical venues with online platforms, remains central to its operations across various markets. Sher emphasizes that even with simultaneous tax increases across both channels, Codere’s strategic focus will not waver. The company plans to recalibrate investments between retail and digital, enhance loyalty and CRM initiatives, and ensure that customers remain engaged within the regulated ecosystem.
The concern that higher taxes might drive players toward offshore operators or the illegal market is shared by many analysts. Codere acknowledges this risk, with Sher advocating for a balanced and enforceable framework. This framework should include reasonable taxation, effective enforcement against unlicensed operators—such as payment and IP blocking—and robust consumer protections. He asserts that both operators and governments aim to channel demand into the regulated market, but excessive tax burdens might have the opposite effect.
Governments often justify tax increases as a necessary means to raise revenue. However, from a business perspective, Sher questions the sustainability of such high increases. He suggests that steep or rapid tax hikes could make the regulated product less attractive, potentially driving consumers to unlicensed alternatives. This shift would ultimately reduce the taxable base, leading to lower net tax collection over time. Codere advocates for a tax policy that balances fiscal objectives with strong channelling to the regulated offer, emphasizing that predictable, proportionate taxation combined with strict enforcement maximizes long-term revenues and consumer protections.
Looking ahead to 2026 and beyond, Sher offers recommendations to the governments of Mexico, Colombia, and Argentina. Rather than focusing solely on raising taxes for compliant operators, he advises the prioritization of enforceable regulations that apply equally across all channels. This would involve clear and consistent rules, combined with rigorous enforcement against illegal sites, payment routes, and advertising. Such measures would ensure a level playing field where everyone competes under the same framework, ultimately keeping customers within a regulated and safer market.
In conclusion, Codere Online is navigating a complex and evolving fiscal landscape in Latin America. Through strategic adjustments and a continued focus on maintaining a competitive edge within the regulated market, Codere aims to mitigate the challenges posed by potential tax reforms. Sher’s insights underscore the importance of balanced policies that protect consumer interests while ensuring the long-term sustainability of the gaming sector.
