Colombia's administrative department, through the Ministry of Finance, has submitted a new tax reform bill to Congress, planning to impose a 19% value-added tax on casinos and online gambling. This bill is a continuation of last year's failed financing bill, aimed at funding the 2026 budget while maintaining mid-term macroeconomic stability.
Finance Minister Herman Avila stated during the introduction of the bill that it is expected to raise an additional 26.3 trillion Colombian pesos (about 6.3 billion US dollars) by taxing industries such as gambling and churches. He emphasized that the tax reform will be discussed in conjunction with the 2026 total budget and called for serious debate among social, political, union, and economic stakeholders.
Congress must approve the budget and tax reform bill by the end of September, otherwise, the government may implement it through a decree. The VAT is initially set for a 90-day trial period, but according to the administrative department's emergency measures, this tax policy may continue until the end of the year.
Operator Concerns: Revenue Decline and Sustainability Risks
The gambling industry has expressed strong concerns about the tax reform. Data from the Colombian Gaming Entrepreneurs Association (Fecoljuegos) shows that from March to June 2025, the actual business income of online gambling decreased by 32%.
To cope with the VAT pressure, operators try to absorb some of the costs through discounts and promotions, avoiding passing the tax burden directly to players. Unions claim that this strategy temporarily mitigates the potential 50% revenue decline risk, but warn that it is an unsustainable financial measure.
Operators point out that this revenue decline has already begun to affect public resources, especially the health system. In January 2025, monthly transfers to the health department exceeded 40 billion Colombian pesos (about 9.8 million US dollars); since March, this figure has dropped to an average of 27 billion pesos (about 6.6 million US dollars) per month, a decrease of nearly 13 billion pesos (about 3.2 million US dollars) per month. Operators warn that if the tax burden remains high, it could not only threaten the sustainability of legitimate companies but also affect the allocation of funds for public services such as the health system.
Conclusion
From the operators' perspective, the high VAT may temporarily balance government revenue pressures, but it could weaken industry stability in the long term, push players towards underground or informal platforms, and pose risks to the sustainability of public resources. Operators call for tax reforms that ensure fiscal revenue while maintaining market sustainability and legal certainty in the industry.
