Colombia’s outgoing government has launched another attempt to make a permanent tax on online gambling part of the country’s tax system before President Gustavo Petro leaves office next month.
The administration submitted a new tax reform bill to Congress that would introduce a permanent 19% value-added tax (VAT) on online gambling, reviving a proposal that lawmakers previously rejected. If approved, the government estimates the measure could generate around COP1.7 trillion (approximately $531 million) in tax revenue during 2027.
The proposal arrives just weeks before president-elect Abelardo de la Espriella is due to take office on 7 August, making it one of the Petro administration’s final major fiscal initiatives. The bill is part of a wider package aimed at converting several temporary emergency tax measures into permanent legislation.
Colombia first introduced a 19% gambling VAT in February 2025 under emergency powers, arguing additional revenue was needed to respond to the security crisis in the Catatumbo region. Congress later rejected plans to make the measure permanent, while Colombia’s Constitutional Court suspended a later version of the tax after questioning the legal basis of the emergency decree.
Since then, the government has continued adjusting its approach. A separate emergency decree introduced a temporary 16% consumption tax linked to online gambling during 2026 as authorities sought funding to address severe flooding across several provinces.
The latest proposal would once again apply a 19% VAT to player deposits, according to legal analysis cited by industry experts, a move expected to face renewed opposition from operators. Previous tax increases prompted several licensed gambling companies to compensate customers through promotional credits and bonuses to soften the impact.
Government officials argue the tax has not caused lasting damage to the online gambling market and say it would eliminate what they describe as an imbalance between digital operators and land-based casinos, which are already subject to the standard 19% VAT. The reform states that online gambling should no longer benefit from preferential tax treatment compared with retail gambling businesses.
However, the industry has disputed that assessment. The Colombian Federation of Gambling Entrepreneurs previously reported that online gross gaming revenue dropped by roughly 30% during the first two months after the original VAT was introduced in 2025, warning that higher taxation could weaken the regulated market.
Despite the government’s renewed effort, analysts believe the proposal faces an uncertain path through Congress, particularly with the current administration nearing the end of its term and no clear indication that the incoming government will back the legislation.