President Pedro Castillo has signed into law the country’s long-awaited legislation to regulate online gambling and sports betting.
The bill-signing event on Friday afternoon (August 12) was attended by foreign trade and tourism minister Roberto Sánchez, whose ministry will be in charge of overseeing the online gambling industry, in addition to Peru's ministers for education, health and women.
The new law establishes a headline online gambling tax rate of 12 percent of gross gaming revenue, which will effectively be 10 percent after allowed deductions for maintenance costs.
Of the tax revenue collected, 20 percent will be earmarked for the Public Treasury, a further 20 percent for the Peruvian Institute of Sports, 20 percent for the Ministry of Health for mental health programmes and the remaining 40 percent will go to tourism ministry MINCETUR.
The law will enter into formal effect 60 days after it is published in Peru's official gazette, with MINCETUR required to promulgate more detailed implementing regulations within 120 days of publication.
The approved bill, 2070/2021, will see MINCETUR issue licences to both Peruvian operators and the local branches of foreign operators to allow them to offer online casinos games and sports betting to players in Peru.
It also gives the authority to MINCETUR to allow physical establishments to operate sports-betting terminals.
President Castillo was triumphant at the signing, commenting: “This is a law that will benefit the country, because on the one hand it will allow the state to have more resources to meet its obligations in economic and social matters, which will result in better living conditions, and on the other, because it represents an important step in the formalisation of activities that until today operated without any type of control.”
He also stated that he estimates yearly tax revenue will be 156m soles, or about US$40m.
Many in the industry remain critical of the law’s construction, however, after it apparently messily combined various drafts addressing the regulation of gambling. For example, Article 40 of the bill fails to mention foreign operators when stating which entities have to pay the 12 percent tax.
Gonzalo Pérez, the CEO of local operator Apuesta Total, told VIXIO GamblingCompliance: “I consider that the approval of the law did not have the previous discussion that we expected and was approved in a hurried manner during the early hours of the last day of the legislative period, with the objective that both the executive and legislative branches show achievements that will improve their popularity, in view of the low popularity of both branches of government.”
But concerns over potential legal loopholes requiring amendment were not mentioned at Friday's bill-signing ceremony, where President Castillo vowed, “we are going to collect the taxes that correspond to the companies”.
“If all Peruvians pay our taxes, why are we going to let some companies not do it? We are a state power that owes the people and we will do everything in our power to protect it,” he said.