Operators in Colombia are set to see relief as the government’s 19% value-added tax (VAT) on online gambling is expected to expire on December 31, 2025, following the defeat of the proposed Financing Law in Congress.
Financing Law Defeated
Last Tuesday, the Senate’s Fourth Committee voted 9-4 against the Financing Law, which would have made the 19% VAT permanent. The bill also proposed raising the capital gains tax on gambling and lotteries from 20% to 30%.
The VAT, introduced in February 2025, was intended to cover government expenses related to civil disturbances in the Catatumbo region. Its removal is a major win for the gambling sector, which had faced nearly a year of additional taxation on player deposits.
Impact on the Gambling Sector
The Colombian Federation of Gambling Entrepreneurs (Fecoljuegos) had warned that the tax was “unsustainable and unfeasible,” citing risks of licensed operators leaving the market and illegal operators filling the gap.
Following the VAT’s introduction, online gross gaming revenue (GGR) reportedly dropped 30%, with some operators experiencing declines of nearly 50% in deposits and average deposit amounts per player.
Operators, including Stake, attempted to offset losses by offering additional player bonuses. Fecoljuegos also highlighted the VAT’s impact on Colombia’s healthcare funding, which relied on COP990 billion in gambling taxes during 2024.
Mixed Operator Reactions
Gambling operators have taken varied approaches in response to the VAT. Codere Online indicated it would not prioritize Colombia in its short- to mid-term strategy, following CEO Aviv Sher’s announcement to pull back from the market. In contrast, Rush Street Interactive expressed optimism, with CEO Richard Schwartz noting that strong operational performance positions the company for growth once normal tax conditions return. Schwartz also predicted that Congress would reject any proposed online gaming tax in 2026.
Looking Ahead
With the Financing Law defeated, Colombia’s gambling industry anticipates a return to more favorable conditions starting in 2026. Licensed operators may regain market stability, while players could benefit from improved promotions and reduced taxation.
The decision represents a significant turning point for the country’s regulated gambling sector, providing a boost to both operators and the broader gaming ecosystem.
