Key Points
- Let’s get down to brass tacks, the 22% tax is on the money operators take in minus what they pay out in winnings, not the total amount of bets placed.
- And then there’s the bombshell, all betting adverts would be banned. Operators who’ve got transitional licences can honour existing contracts for up to 12 months after the ban kicks in.
- Just to confuse things a bit further, courts still consider unlicensed betting to be against the law, but Chile’s tax authority is already collecting VAT from foreign platforms.
Two Numbers That Don’t Add Up
On 26th October, Chile’s government put forward not one but two competing ideas for its betting reform plan: a 22% tax and a complete stop on advertising betting. The government wants people to start using licensed betting sites, but the same proposal makes it impossible for those sites to promote themselves.
President José Antonio Kast’s government chucked 172 amendments onto the stalled bill at the same time. The next day, the Senate Economy Committee started reviewing them, with under-secretary of finance Sebastián Vallebona done on the presentation of the proposals. He claimed that a total ban on betting just isn’t a workable idea.
And to add to the confusion, the proposals haven’t actually become law yet. Meanwhile, a separate group of senators on the same committee wants to chuck private online betting altogether.
How Will the 22% Tax Work?
Licensed operators will pay 19% VAT on the money they get from bets, after they’ve paid out the winnings to the players. This will be a monthly calculation.
Then on top of that, they’ll have to pay a 3% tax on the same amount, taking the total rate to 22%. This means operators will be paying 22% of their betting profit, not on every peso wagered.
Licenses will be for 5 years, and operators will also have to pay 1,000 monthly tax units a year for the license, which is about $73,500.
The original bill had proposed an even heavier tax burden, a 20% levy on the total revenue, plus extra charges of 2% and 1%, which added up to nearly 38% and it was all estimated by finance ministry officials.
Transitional Licenses and the Tax Bill
Operators that have already got a foothold in Chile have a special route to get a transitional license. The upfront fee is 3,000 monthly tax units, which is around $220,000.
On top of that, they have to sort out and pay any VAT they owe for the past 3 years, and they can only do this if they can prove it through a tax payment or an agreement with the Treasury to pay up.
Companies that’ve operated without a license in the past year aren’t allowed to just get a license without this route. Having a .cl domain, sponsorship deals in Chile or contracts with local payment providers can be seen as proof of operations.
Land-based casinos in Chile are getting a bit miffed over the low fee. Some are saying it acts as a get-out for past wrongdoing.
Cecilia Valdés, the president of the ACCJ is accepting some of the government’s clarifications, but still has some major reservations about what she calls “real fundamental inequalities”.
“We want competition, but it has to be fair, honest and from serious operators”
Unlicensed Platforms Paying Chilean VAT
Since June, Chile’s tax authority has maintained an online VAT system for foreign betting platforms. This way, the companies may pay VAT and register themselves. Non-registered platforms will be charged VAT by their payment service providers.
The head of the agency informed senators in June that the collection of this tax is not permission for any platform to conduct business in Chile.
On 30 September 2025, the Supreme Court passed a verdict in this regard. In its divided decision, the Court declared online gambling illegal without the respective law permitting such activity. Moreover, internet providers were to block websites that had been listed by the court in the case initiated by Lotería de Concepción.
APAL criticised this decision, pointing out its uncertainty and inconsistency with previous verdicts given in criminal court.
The court orders quickly turned into website blocks. So, Subtel obliged internet providers to block 42 websites on 1 September. Then, on 9 September, there was a second order issued by the authority obliging internet providers to block another 37 websites, subdomains, and mirror sites.
Advertising Would Cease, Except in One Case
According to Article 41 of the draft law, any online gambling advertisements of any kind would become banned. The regulation would apply to all who order, design, produce or carry an advertisement.
It is stated that a licensed operator violating the law on advertising prohibition may lose its licence (Chilean press sources). It would also ban advertisements of bonuses and promotional activities intended to attract more players or retain current ones without any advertisements.
There is one limited exception for operators possessing a transitional licence. Such operators would be allowed to use advertising contracts established prior to the law coming into force. All such contracts should cease within one year from the introduction of the ban.
The advertising ban would start 30 days after the gambling regulator announces its decision regarding all transitional licence applications.
Prior to introducing the ban, all gambling advertising on TV and radio should be carried out only from 10 pm till 6 am and have warnings about gambling addiction.
“A modern regulatory framework must not confuse protection with prohibition,” warned the Agrupación de iGaming Responsable.
Senators Still At Odds Over Three Different Plans
The government’s proposal is being fiercely opposed by two groups of senators, each of whom are strong supporters of their own competing solutions.
Two senators Diego Ibáñez and Gastón Saavedra have put forward an amendment calling for a full ban on online gambling. The good news for existing operators is that they’d be given up to two years to shut up shop, as long as they’re registered with the tax authority. If they don’t, they could be facing prison sentences of six months to three years. Saavedra happens to chair the Senate Economy Committee which means his position carries a bit more weight in the current debate.
Senator Paulina Núñez however has a different idea. She wants online gambling to be the exclusive domain of Polla Chilena de Beneficencia and Lotería de Concepción. Neither of these lottery operators would be allowed to launch any new products. Her plan would also include stricter penalties for those who break the law, including permanent website blocks for any operators who continue operating illegally.
Other countries are also looking at imposing restrictions. Brazil for example suspended online betting back in October, while Buenos Aires Province in Argentina is weighing up a similar ban.
New Player Protections Tucked Away Amidst the Tax Proposals
The bill also includes a bunch of new measures aimed at protecting players from themselves.
Every new online account would have some default limits in place to stop people blowing their whole paycheck on online games, and to keep people from gaming for too long. And operators would need to step up their game when it comes to security, that might mean biometric checks and all the rest.
The government has also planned a national register of all the people who want to stop themselves from gambling (or who can’t gamble because of some other reason). That would stop self-excluded players, prisoners and people who owe child support from getting their hands on online betting sites. And it would also prevent pro athletes or anyone with an interest in the betting industry from placing bets on their own sports.
The proposal also includes a fund that the health and social development ministries would manage. It would be used to help people who have a problem with gambling, either to stop them getting hooked in the first place or to help them get treatment if they do.
The Finance Ministry is also going to introduce some new rules to make sure that online gamblers are treated fairly. They’ll be reviewed every four years to make sure they’re working as they should.
What Happens Next?
The Senate Economy Committee will get together again at some point, but we don’t know when yet. Once that meeting is done the bill will move on to the Finance Committee according to Emol.
Senators first voted in favour of regulating online betting back in August 2025, 27 votes to 3. The bill was first introduced back in March 2022, and since then the previous administration has withdrawn some amendments it put forward back in September 2025.
Expert Analysis: Chile Is Taxing a Market Its Courts Call Illegal
We see a contradiction that the proposed law does not fully resolve. Chile’s courts consider unlicensed betting illegal, yet the tax authority collects VAT from foreign platforms. In June, the casino association described this arrangement as disguised regularisation.
We think that criticism is partly justified. The tax is lawful to collect, but collecting it has also helped make the betting activity appear normal, even though the platforms remain unlicensed.
Our main concern is the advertising ban. It would remove the main way licensed operators can make players aware of their services.
Transport and Telecommunications Minister Louis De Grange admitted that illegal betting companies can set up replacement websites within hours. Subtel also warned in June that no blocking method can guarantee a permanent and fully effective result.
The government would therefore rely on website blocking while preventing licensed companies from advertising. That leaves operators with limited ways to reach customers who might otherwise use unlicensed sites.
The transitional period could become another point of dispute once senators examine the details. Advertising contracts signed before the law is published may allow operators identified as previously unlicensed to keep their sponsorship deals running for another year.
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