Chile's online gambling initiative is gaining traction as President José Antonio Kast's government has submitted amendments aimed at legalizing private operators under a structured licensing and tax framework to the Senate.
The bill, introduced in 2022, has encountered several delays but is now advancing following the submission of crucial amendments to the Senate’s Economic Committee on October 26.
These proposals include provisions for five-year licenses, a 19% VAT on the profit margin between stakes and winnings, and an additional 3% levy. Furthermore, the draft legislation seeks to prohibit advertising and promotional bonuses while establishing default limits on player deposits and gameplay duration.
Nevertheless, significant disputes persist, notably regarding the treatment of operators that had been active outside the established legal structure, advertising restrictions, and the disparate tax burdens on online versus traditional brick-and-mortar casinos. Industry representatives have expressed concerns that the current proposals may advantage unregulated operators, jeopardizing the stability of Chile’s conventional casino industry.
Among the most contentious components of the bill is the transitional regime for online operators already functioning without official licenses. The draft permits these entities to apply for interim licenses, enabling them to continue operations during the process of technical certification and regulatory oversight.
However, debate rages over the financial requirements attached to this transitional status. Proposed fees vary dramatically, with suggestions ranging from a significant monthly charge of 73,000 UTM (Chile’s inflation-indexed tax unit) to a one-time or periodic payment of 3,000 UTM, approximately equivalent to $219,000. This lower fee, in particular, has attracted severe criticism from the industry, with opponents labeling it a de facto “pardon” for previous illegal activities, effectively rewarding companies that evaded compliance.
Critics maintain that such measures undermine the bill's purpose of establishing equitable competition, potentially harming fully licensed market participants. The proposal would also allow land-based casinos to facilitate online betting via partnerships with licensed operators.
There is a division in the Senate regarding the extent of regulation needed. Earlier this month, Senators Diego Ibáñez and Gastón Saavedra introduced an alternative proposal aimed at banning online gambling outright. Additionally, Senator Daniel Núñez proposed an amendment that would restrict the market exclusively to Chile's two existing lottery organizations while imposing penalties on consumers who knowingly wager on illegal sites multiple times within a 90-day window.
Last month, Chilean authorities took action against unlicensed operators by directing telecommunications providers to block access to 42 gambling websites following judicial rulings.
The Asociación de Casinos y Juegos (ACCJ), which represents Chile’s licensed casino sector, has vocally opposing the transitional provisions and overall fiscal strategies. In a recent discussion on Diario Financiero's DF al Cierre program, ACCJ’s executive president, Cecilia Valdés, recognized some positive regulatory advancements but cautioned that "fundamental asymmetries" still exist.
Valdés expressed particular concern that the proposed transitional framework may let online betting platforms operate without facing repercussions for their previous illegal activities. “We want competition, but it has to be real, fair, and from legitimate companies,” she asserted. She also emphasized the disparate tax obligations between licensed land-based casinos and online businesses, noting that the former contribute specific taxes that fund local municipalities and governments.
