Colombia senate vote clears path for online gambling VAT to end
Summary
A Senate Fourth Committee vote (9-4) blocked the Financing Law that would have made a temporary 19% VAT on online gambling permanent. The levy, introduced in February to fund spending linked to civil disturbances in Catatumbo, is expected to expire on 31 December. The government now faces a fiscal gap despite an already approved national budget of COP546.9 trillion. Industry bodies warned the tax damaged legal operators’ revenues and could push players towards illegal alternatives.
Key Points
- The temporary 19% VAT on online gambling in Colombia is due to expire on 31 December after senators blocked making it permanent.
- The Financing Law would have extended the VAT and raised capital gains tax on gambling and lottery winnings from 20% to 30%.
- Finance Minister Germán Ávila criticised the vote, saying it was politically driven and ignores fiscal realities.
- Congress has approved a national budget of COP546.9 trillion, but the failed law leaves a revenue shortfall tied to the rejected measures.
- Fecoljuegos reported a c.30% decline in online gross gaming revenue after the VAT’s introduction; some operators saw decreases close to 50% in deposits and player metrics.
- Operators reacted differently: some reduced activity or signalled potential exits, while others (e.g. Rush Street Interactive) remained optimistic the VAT would be removed.
Content Summary
The article explains the parliamentary defeat of the Financing Law in Colombia’s Senate committee and the practical consequence: the temporary online-gambling VAT is likely to lapse at year-end. It sets out the origin of the tax (introduced to support spending tied to unrest in Catatumbo), the proposed additional tax measures that were rejected, and reactions from the finance ministry and the gaming industry. The piece highlights industry data showing steep revenue declines after the VAT’s introduction and quotes operators’ public comments on their Colombian strategies.
Context and Relevance
This is a significant development for the Colombian iGaming market and for regional operators. A permanent VAT would have materially changed pricing, player behaviour and operator economics; its likely expiry restores the prior tax regime and removes a near-term regulatory headwind. The outcome also affects investment decisions, market entry plans and the risk of migration to unregulated operators — all key concerns for operators, suppliers and regulators in Latin America.
Why should I read this?
Quick heads-up: if you work in iGaming, payments, compliance or invest in Latin America, this directly affects revenue and strategy in Colombia. The Senate vote probably means operators get breathing space from a punitive 19% VAT — that changes pricing, retention and who stays in the market. Worth five minutes to see how it might alter your plans for 2026.