The Colombian government has proposed a budget of 557 trillion pesos for 2026, marking an increase from the current year’s allocation, as the nation grapples with declining public finances and an expanding fiscal deficit. President Gustavo Petro’s proposal requires Congressional approval by October 20, but his spending plans have encountered opposition from lawmakers, leading him to implement this year’s budget via decree. The national budget for 2026 will maintain spending levels despite the ongoing deficit and fiscal challenges. The forthcoming bill, set to be submitted to Congress soon, is expected to introduce a revised approach to tax collection, potentially increasing the tax burden for churches and the gambling industry.
The unwillingness of President Gustavo Petro’s administration to compromise on spending priorities complicates efforts to achieve fiscal targets meaning that the industry has been singled out for raft of new taxes to plug the gap.
In February 2025 Colombia’s Minister of Finance, Diego Guevara, announced that, based on the state of emergency decree due to the security crisis in Catatumbo, 19 % VAT will be implemented on online gambling until December 31, 2025, with the aim of financing expenses related to the state of internal commotion. The decree gives the president emergency powers to restore order in a region that has been impacted by an outbreak of deadly violence between rival armed groups. The State of Internal Unrest ended in Colombia on April 24 but the increased taxes will remain in place until the end of the year.
In addition, the Colombian Federation of Entrepreneurs in Games of Chance and Luck (Fecoljuegos) has already raised concerns regarding Decree 0572, which requires advance collection of withholding tax for 2026, starting from May 29, 2025. This new requirement adds to the already existing 19% VAT on online games.
In June Fecoljuegos expressed its firm rejection of the activation of the “escape clause” by the Superior Council of Fiscal Policy (CONFIS), which will allow the National Government to suspend the fiscal rule for the next three years.
The fiscal rule, implemented in 2011, places restrictions on government spending and debt to maintain the long-term sustainability of public finances and macroeconomic stability. Colombia has invoked the clause to lift borrowing limits, as the finance ministry projects the largest fiscal deficit since the pandemic. Additionally, the ministry announced plans to present a bill to Congress aimed at raising taxes. The government has also revised its forecast for the 2025 fiscal deficit to approximately 7.1% of gross domestic product.
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The Colombian government has proposed a budget of 557 trillion pesos for 2026, marking an increase from the current year’s allocation, as the nation grapples with declining public finances and an expanding fiscal deficit. President Gustavo Petro’s proposal requires Congressional approval by October 20, but his spending plans have encountered opposition from lawmakers, leading him…
The post New taxes on gambling likely in Colombia as government rules out spending cuts appeared first on G3 Newswire.