Colombia Shifts Online Gambling Tax to GGR in Bid to Stabilise Market

The Colombian government has revised its taxation framework for online gambling, changing the application of the 19 per cent value-added tax (VAT) from player deposits to gross gaming revenue (GGR).

The revised policy came into force on January 1, marking a significant shift in how the sector is taxed by focusing on the actual income generated by operators rather than the total amounts deposited by players.

The original deposit-based 19 per cent VAT was introduced in February 2025 as a temporary measure during a period of internal unrest. However, throughout 2025 the policy attracted widespread criticism from industry stakeholders, as it effectively taxed money that was repeatedly wagered and, in many cases, returned to players as winnings. As a result, the tax failed to accurately reflect operators’ real revenues.

Licensed operators strongly opposed the deposit-based model, with some of the most vocal criticism coming from Codere Online, a major Spanish gambling operator. In November 2025, Codere Online announced that it would halt any further investment in Colombia unless the tax was repealed, warning that the measure threatened the financial sustainability of the regulated market. Under the previous structure, license-holders were required to absorb the full 19 per cent tax burden while continuing to offer promotional bonuses to customers, placing severe strain on operating margins.

The impact of the policy was reflected in market performance. Licensed operators and industry trade body Fecoljuegos reported a sharp contraction in sector activity, with notable declines in key metrics including GGR, total deposits and overall player participation. Industry estimates suggested that gambling revenues in 2025 may have fallen by as much as 30 per cent as a direct consequence of the tax.

The decision to revise the tax framework forms part of a broader emergency economic decree aimed at addressing a fiscal gap created by the failure of the government’s 2025 tax reform. Through these measures, the authorities are seeking to raise more than COP10tn (approximately US$2.65bn) in additional revenue, with the revised gambling tax expected to contribute to this target while restoring balance to the market.

As the new GGR-based tax takes effect, industry stakeholders are cautiously optimistic that the changes will lead to a more sustainable and equitable fiscal environment for Colombia’s regulated online gambling sector.

By fLEXI tEAM