Fecoljuegos Criticizes Colombia’s 19% Online Gaming Tax
The Colombian Federation of Business Operators of Games of Chance (Fecoljuegos) has raised fresh concerns over the government’s decision to maintain a 19 percent tax on player deposits made through licensed online gaming platforms under the current economic emergency decree. The federation has described the measure as “untechnical” arguing that it fails to reflect how the regulated online gambling sector actually operates.
According to Fecoljuegos, taxing deposits instead of wagers placed or net gaming revenue introduces a fundamental distortion into the market. The organization warned that such an approach ignores the sector’s real economic dynamics and could ultimately push players away from regulated operators and into illegal platforms.
Tax Charged Before Any Gambling Activity
Fecoljuegos president Evert Montero criticised the structure of the levy, noting that the tax is imposed regardless of whether a deposited amount is fully wagered, partially used or even withdrawn without any betting activity at all. He described the policy as illogical, stressing that taxation is applied before gambling activity even occurs.
Montero explained that at the time of deposit, it is impossible to determine how much of the balance will actually be wagered, how often it may be recycled through gameplay or whether it will eventually be withdrawn untouched. He added that this model artificially inflates financial indicators, as the repeated circulation of player credits known as “re-play” does not represent real income for operators but merely internal movement of player balances.
Increased Risk of Illegal Market Expansion
Beyond technical flaws, Fecoljuegos also warned of serious market consequences. Montero argued that charging players a 19 percent tax upfront creates a strong incentive to migrate to unlicensed operators, where no such charges apply. He cautioned that the policy effectively hands market share to illegal platforms that operate without regulatory oversight or consumer protections.
He further noted that growing regulatory uncertainty is already damaging investor confidence. According to Montero, several companies including multinational groups are reassessing their presence in Colombia. As an example, he pointed to at least one operator that has already relocated its operations to Argentina in response to current conditions.
Push for a Revenue-Based Tax Model
In response, Fecoljuegos reiterated its willingness to collaborate with authorities on alternative, long-term solutions. The federation has submitted technical proposals to the Ministry of Finance advocating for a permanent taxation framework based on actual income generated by operators, rather than on player deposits or prize distributions after costs.
Montero emphasized that the regulated gaming industry plays a significant role in public financing, noting that Colombia’s Constitution mandates that 15 percent of the sector’s income is allocated directly to the national health system. He argued that a tax structure aligned with the true economic model of the industry would protect public revenues while ensuring the sustainability of legal operators.
Broader Fiscal Debate Continues
The debate over gaming taxation is unfolding alongside wider fiscal discussions in Colombia. Recently, the Senate’s Economic Committee rejected a broader tax reform proposal that included raising VAT on online sports betting to 19 percent. The initiative, which aimed to generate an estimated USD 4.255 billion to support the 2026 national budget, was voted down by nine senators, with only four in favour.
Following the rejection, Finance Minister Germán Ávila stated that the government would consider all available options to meet its fiscal and social obligations. He criticised the vote, arguing that opposition from a small group of legislators had contributed to a fiscal shortfall.
As discussions continue, Colombia’s regulated online gaming sector finds itself navigating mounting financial pressure, policy uncertainty and intensifying competition from the illegal market.
