New details have emerged regarding the new tax reform project proposed by Gustavo Petro’s government, which aims to raise 12 trillion pesos. The details were revealed by Wadith Manzur, a member of the House of Representatives from the Conservative Party, following a private meeting between congress members and the Minister of Finance, Ricardo Bonilla.
According to the congressman the proposals are still being negotiated between the minister and the president. Manzur stated that the Petro administration is targeting new sources of revenue. Among other points, the proposal would introduce a 19 per cent VAT on online gambling.
“The government is seeking to expand its tax base by including VAT on games of chance and online gambling, as well as targeting Airbnb owners,” declared Manzur. Additionally, he noted that an increase in the coal tax and a rise in taxation on occasional gains are expected, while a wealth tax would remain in place.
Juan Carlos Restrepo, president of the Colombian Association of Gaming Operators (Asojuegos), stated that the tax would be passed directly to consumers, who currently receive a return of between 90 and 95 per cent, meaning that for every peso bet, between 90 and 95 cents are returned to the bettor. With the tax applied, this would drop to approximately 78 per cent.
“Bettors would prefer to wager on international platforms that do not charge VAT and that guarantee the same returns they currently have with companies offering entertainment services in Colombia. Those resources, which today go to health funding, would be redirected to companies that neither pay taxes in Colombia nor operate legally in the country,” added Restrepo.
“I believe this is a serious mistake that will impact the revenues currently available for health in Colombia because the operation of online games has significantly increased its resources and contributions to the health sector; these will be the ones most affected, in addition to potentially making many companies completely unviable in their operations in the country,” Restrepo concluded.