Colombia Files Permanent 19% Online Gambling VAT as Petro Nears August Exit

Updated July 2026

Colombia's outgoing President Gustavo Petro filed a permanent 19% value-added tax on online gambling with Congress on July 24, 2026, in what is his administration's fourth attempt in 18 months to make the levy stick. The proposal must clear a hostile Senate and gain presidential signature before Petro leaves office on August 7, giving legislators fewer than two weeks to act.

If passed, the government projects the measure would generate approximately COP 1.7 trillion (roughly $530.8 million) in tax revenue during 2027, according to figures published with the bill. Industry data tells a different story: when a near-identical emergency decree was enforced in early 2025, Colombia's licensed online gaming gross gaming revenue fell by 30%, a figure reported by iGaming Business based on operator submissions.

• Bill filed: July 24, 2026, by Colombia's Ministry of Finance on behalf of the Petro administration.
• Tax rate proposed: 19% VAT on online gambling transactions, matching Colombia's standard rate and the rate applied to land-based casinos.
• Revenue target: COP 1.7 trillion (approximately $530.8 million) in 2027, per government projections.
• Government handover: August 7, 2026, when Petro's successor takes office.
• GGR impact of prior VAT: Approximately 30% decline in licensed online gaming revenue when first enforced, per iGaming Business and industry submissions.

What Is the Proposed Online Gambling VAT and How Would It Work?

The bill would impose a 19% VAT on all online gambling transactions conducted through licensed platforms in Colombia, including sports betting and online casino play. This is the same rate Colombia applies to land-based casinos and to most goods and services in the general economy. The government's stated rationale is that the absence of VAT on digital gambling creates an unfair competitive advantage for online operators over their land-based counterparts, and that embedding the levy in ordinary statute, rather than emergency decree, would resolve the constitutional challenges that have defeated every previous version. The bill's text invokes constitutional principles of "progressivity and equity" in taxation to pre-empt procedural challenges.

Why Have Three Previous Attempts to Introduce the VAT Failed?

Each prior attempt collapsed at a different stage of the legislative or judicial process. The original 19% VAT was introduced via emergency decree in February 2025 to fund the government's response to the Catatumbo security crisis in northern Colombia. Congress rejected a subsequent Financing Law that would have made it permanent: the Senate's Fourth Committee voted 9 to 4 against in December 2025. The Constitutional Court then suspended the emergency decree itself on January 29, 2026, provisionally halting the VAT and marking the first time in Colombia's constitutional history that a court struck down an emergency economic decree. A fresh emergency instrument imposing a 16% consumption tax on deposits was introduced in March 2026 as a stopgap while the government prepared new legislation.

What Did the VAT Do to Colombia's Online Gaming Market?

The period when the VAT was enforced in early 2025 caused measurable damage to Colombia's licensed sector. Online GGR fell by approximately 30% compared to the pre-VAT baseline, according to industry data reported by iGaming Business. Operators attributed the collapse to the structure of the tax: because it was applied to player deposits rather than net operator revenue, it functioned as a surcharge that pushed price-sensitive players toward unlicensed offshore platforms. Those unregulated alternatives pay no Colombian tax, so every percentage point added to licensed operators' costs widens the competitive gap in the black market's favour.

Why Does the Government Dispute the Revenue Impact?

The Petro administration's bill states it found "no evidence of significant deterioration in the sector" attributable to the VAT. This conflicts directly with operator-reported data. The discrepancy may reflect the government measuring broader economic activity or using Coljuegos aggregate metrics that blend land-based and online channels, where revenue trends differ. Industry groups have repeatedly submitted data to regulators contesting the government's assessment, but the administration maintained its position throughout the period of legislative preparation.

How Does the New Bill Differ Legally from the Emergency Decrees?

The constitutional difference is significant. Emergency decrees in Colombia are tied to a specific declared crisis and subject to automatic Constitutional Court review, which can suspend them as happened in January 2026. Ordinary legislation passed by Congress carries no such vulnerability: once signed into law, it can only be challenged through separate constitutional proceedings that take considerably longer to conclude. If the Petro bill passes, it would give the VAT a legal stability that none of its predecessors achieved. The bill specifically frames the measure as closing a tax equity gap to pre-empt the procedural challenges that eliminated earlier decrees.

How Does Colombia's Total Tax Burden Compare to Other Latin American Markets?

Market	Primary Gambling Tax	Basis	Status (July 2026)
Colombia (current)	15% GGR + 16% deposit consumption tax (temporary)	Net revenue + deposits	VAT suspended; new bill pending
Colombia (proposed)	15% GGR + 19% VAT	Net revenue + transactions	Legislation submitted July 24, 2026
Brazil	12% GGR	Net gaming revenue	Live and enforced from 2025
Argentina (Buenos Aires)	10 to 15% GGR	Net gaming revenue	Province-by-province framework
Mexico	16% IVA on prizes + federal levies	Player prizes	Active national framework

What Is the Risk to Licensed Operators If the VAT Passes?

A permanent 19% VAT on top of the existing 15% GGR tax would create one of the heaviest combined regulatory tax burdens in Latin America for licensed online operators. The compounding effect is particularly acute because the VAT applies to transaction values, not operator net revenue. In practice an operator paying 15% on net winnings and a further 19% on all deposit activity faces an effective combined rate that can significantly exceed the GGR tax alone in low-margin segments such as sports betting. Smaller licensed operators with thinner margins are most exposed. A heavier domestic tax burden also widens the price advantage already enjoyed by unlicensed offshore platforms that pay nothing to Colombian authorities.

Is the Bill Likely to Pass Before Petro Leaves Office?

Political analysts give the bill a difficult path. The same Senate committee that rejected the December 2025 Financing Law remains in place. Petro has limited coalition leverage as a lame-duck president. SCCG Management noted in July 2026 analysis that "Petro's reduced political capital and the proximity of the presidential transition make congressional approval challenging." If the new administration taking office on August 7 chooses not to revive the measure, Colombia's online gambling sector would operate under only the 15% GGR levy, at least until new fiscal pressures emerge in 2027.

What the Industry Wants Instead

Licensed operators and gambling industry associations in Colombia have consistently called for a stable, GGR-based tax model that does not penalise player acquisition or deposit activity. The contrast with Brazil is frequently cited: Brazil's 12% GGR tax, introduced as part of a structured and politically stable licensing framework, attracted significant international investment and generated reliable state revenue without the disruption Colombia has experienced. Betsson's Q2 2026 results confirmed LatAm as its biggest market by revenue, underlining the commercial prize available to markets that provide regulatory stability. Colombia was once regarded as Latin America's model regulated market after its 2016 licensing framework; repeated fiscal instability since 2025 has eroded that standing among operators allocating capital across the region. Venezuela's iGaming sector and other LatAm markets are watching Colombia's regulatory trajectory closely.

Frequently Asked Questions about Colombia's Online Gambling VAT

What is Colombia's current online gambling tax rate?

As of July 2026, with the 19% VAT suspended by the Constitutional Court, licensed online operators pay a 15% GGR tax administered by Coljuegos. A temporary 16% consumption tax on deposits introduced in March 2026 has been in place while permanent legislation is debated.

When did Colombia first introduce an online gambling VAT?

The 19% VAT on online gambling was first introduced via emergency decree in February 2025, framed as a fiscal measure tied to the Catatumbo security crisis in northern Colombia.

What did Colombia's Constitutional Court rule on the VAT?

On January 29, 2026, the Constitutional Court provisionally suspended the emergency decree imposing the VAT, citing procedural irregularities in cabinet sign-off. This was the first time in Colombia's constitutional history that such a decree had been suspended by the court.

Who regulates online gambling in Colombia?

Coljuegos, the Colombian gaming control board, oversees licensing and regulation of online gambling. Tax collection is administered through the national revenue authority DIAN in coordination with the Ministry of Finance.

What happens if the VAT bill fails in Congress?

If Congress does not pass the bill before August 7, the incoming administration has no obligation to revive it. Political analysts expect no new gambling-specific tax legislation in Colombia before 2027, given the presidential transition and new government priorities.