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The imminent implementation of a consumption tax on every bet leaves Peru’s newly licensed operators stuck between a rock and a hard place as they scramble to comply with conflicting fiscal and gambling regulations.
Peru’s Ministry of Economy and Finance (MEF) published two decrees on Saturday (December 14) to implement two separate taxes that will apply to licensed operators of sports betting and online gaming as of January 1, 2025.
One of the two decrees clarified an earlier legislative decree from September that established a 1 percent consumption tax on the value of every bet placed online.
In addition to setting the January 1 effective date, Supreme Decree 254-2024 specifies that the consumption tax will apply both to Peruvian-based companies and international operators and that it will be levied at the point when money or bonus credits are debited from the player’s account to place the bet.
Local lawyers and executives warn that the narrow implementation window for the new consumption tax presents a major challenge for the industry, and not only because it will increase the overall tax burden for operators who must separately pay a 12 percent tax on their monthly gross revenue.
The crux of the issue is that collecting a 1 percent tax from every wager will require operators to make changes to critical components of their platforms, which would then have to be recertified.
The new consumption tax comes just as operators and suppliers have already made major investments to certify their platforms in accordance with detailed technical regulations established by Peru’s Ministry of Tourism and Foreign Commerce (Mincetur), said Nicolás Samohod Rivarola, a Lima-based lawyer with the firm of Vidal Cáceres Abogados.
“This means that the Peruvian State — through the MEF — intends for regulated companies to comply within 15 days with a technical regulation for which adjustments and approvals will take many months or almost a year, and also require the double cost of a very expensive international certification process,” Samohod told Vixio GamblingCompliance.
“Are these national and international operators in the market now meant to decide between, (a) starting to operate under their licences from the state (from Mincetur) but in violation of the fiscal regulations of the state (from MEF), or (b) remaining stuck and unable to operate until they have adjusted their platforms to the tax regulations of the state (MEF) having been previously authorized to begin by the state (Mincetur)?”
The CEO of Peru-facing online betting operator Apuesta Total offered a similar assessment of a consumption tax he said would be “confiscatory” unless it can actually be paid by the bettors themselves.
Writing on LinkedIn, Gonzálo Pérez called on the Peruvian industry “to take all measures within our power to avoid this disaster”.
“Complex weeks lie ahead for the industry but the technical arguments are on our side and we hope for reasonableness on the part of the government so as not to affect the anticipated revenue,” added Pérez, whose company is in the process of being acquired by Spain’s Cirsa.
Saturday’s tax decrees mark the culmination of a busy year for online gambling regulation in Peru.
Mincetur’s gambling authority opened a licensing window in February and announced in August that a total of 120 authorisations for sports betting and online gaming had been granted to more than 60 operators.
That triggered a 90-day deadline for authorised operators to certify their platforms and submit reports on their registered suppliers, although that compliance deadline was recently extended through to the end of the year.
