The Colombian government has put forward a proposal to impose a 19% value-added tax (VAT) on deposits made to online gambling accounts as part of a comprehensive tax reform bill submitted to Congress. This proposal is currently under consideration.
Under Article 41 of the Economic Rescue Law, gambling operators, regardless of whether they are based in Colombia or abroad, would be required to pay VAT on eligible online deposits made by players accessing the services from within the country.
The new tax would apply to traditional currency and crypto-assets transferred to online gambling accounts for the purpose of placing bets. The VAT would be determined by a unique calculation method, dividing the deposit amount by 1.19 to establish the taxable base.
As part of the tax reform, there will also be increases in the front-taxable amounts for various land-based gambling activities. Specifically, the charge for a casino slot machine is proposed to double from 20 to 40 tax units, while the fee for playing at a table would rise from 290 to 580 tax units. Furthermore, the per-head charge for bingo is set to increase from three to six units. In locations where gambling is not the primary business, the slot machine fee would climb from 10 to 20 units.
Additionally, the proposal aims to raise the tax rate for certain lotteries, raffles, and bets from the current 20% to 30%. The DIAN, Colombia's tax authority, would gain the authority to block websites in cases of technical violations.
The Ministry of Finance estimates that the VAT on online gambling could generate approximately €560.22 million by the year 2027. Predictions also indicate that, from 2028 through 2030, average annual revenue from gambling could reach about €633.05 million, contingent on the proposal's approval and implementation.
The government's goal is to reduce the tax disparity between online and land-based gambling. This tax proposal is set to undergo legislative debate before any potential provisions can be enacted.
