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The Colombian government has published a decree to temporarily impose a 19 percent value-added tax (VAT) on online gaming to raise funds for the disaster in the Catatumbo region.
On Friday (February 14), the Colombian government officially published Decree 0175 to temporarily impose a 19 percent VAT on online gaming to raise funds for the disaster in the Catatumbo region.
The temporary tax will be in place for 90 days, with the option of two extensions, each also 90 days long.
The decree invokes Article 213 of the Colombian Constitution, which gives the President the power to issue such orders during a State of Internal Commotion “in the event of a serious disturbance of public order, which imminently threatens institutional stability”.
Violence erupted in Catatumbo and Norte de Santander, which border Venezuela, in mid-January and has continued since. More than 50,000 people have been displaced at last count by the strife between factions of the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN).
The decree came into effect the day it was published and its provisions apply from the fifth business day following publication, or February 20.
The decree specifies that “although the taxes provided for in this Decree are taxes of immediate accrual, in order to facilitate the operation and make the necessary adjustments to the computer systems, it is established that the measures adopted will apply once a period of five business days following their publication has ended”.
Juan Camilo Carrasco, a lawyer in Bogotá at Asensi Abogados, previously told Vixio GamblingCompliance that the industry had called for a longer implementation period, “to ensure compliance with adjusting the technical gaming systems and proper certifications from laboratories, as it will require changes to the players account and payments”.
Carrasco called the five-day window “fatal”, saying that “it’s not even a transition period”.
President Gustavo Petro attempted to introduce VAT to online gambling in the 2025 budget plan and failed, much to his chagrin.
Petro ran in 2022 on the platform of a total peace plan, promising the country that has seen 45,000 people die and over 8m displaced over the last 60 years an end to warring guerilla militias.
The events in Catatumbo, where at least 80 people have been killed and more than 45,000 children are out of school, have dashed hopes that Petro can deliver on his pledge.
