The Colombian government has changed how it taxes online gambling. Instead of taking 19% VAT from the money players deposit, the tax will now be taken from the real income the companies make after paying out winnings. This means gambling firms will be taxed on what they actually earn, not on all the money that moves through their platforms.

Industry groups have welcomed the change and said the old system was unfair. The Colombian Federation of Gambling Entrepreneurs called it a significant step forward and said the old tax method did not reflect the sector’s economic reality. They believe the new system is more realistic and will help legal gambling companies stay in business.

Emergency Decree Fills Budget Gap

The Colombian government has changed how it taxes online gambling. Instead of charging 19% VAT on the money players deposit, the tax will now be charged on what the companies actually earn after paying out winnings. This means operators will no longer be taxed on every naira that passes through their platforms, but only on their real income.

Industry groups have welcomed the change and described the old system as unfair. The Colombian Federation of Gambling Entrepreneurs called the move a significant step forward and said the old tax method did not reflect the sector’s economic reality.

They explained that taxing deposits made it hard for legal operators to survive, because the tax was often higher than their real profits. With the new system, they believe companies will be able to operate more easily, pay their taxes properly and grow the legal gambling market in Colombia.

Tax Shift Reflects True Business Reality

Fecoljuegos said the old tax on deposits made online gambling income fall by 30%. They added that the new method acknowledges, for the first time, the true math of the business.

The group explained that under the old system, companies were sometimes paying over 70% of what they really earned in tax. With the new tax based on GGR, this will drop to about 34%. Even so, Fecoljuegos said the tax level is still well above international averages.

Industry Calls for Long-Term Plan

The federation said the change is only a first step and more talks with the government are needed to build a long term and stable system.

Fecoljuegos highlighted that “This adjustment allows us to move beyond a clearly unviable situation and opens a minimal, but necessary, margin for the operation of the legal industry.”

The group added that Colombia still needs more improvements to match other countries. Fecoljuegos said it stays “committed to a serious and constructive technical dialogue with the authorities, for the benefit of … the national economy and the healthcare system.”