In late 2025, the Colombian Government adopted an emergency decree that formally adjusted the tax basis of the 19 per cent VAT on online lottery from player deposits to total game income (GGR). The reform marked a fundamental re-establishment of the Colombian lottery system, ending the industry-suffering pattern of taxation of deposits.
Under the old system, operators were required to tax the full amount of the player ‘ s undiscounted cash deposits, resulting in a real tax burden often exceeding 70 per cent of real income. The President of the Colombian Federation of Lottery Enterprises (Fecoljuegos), Evert Montero, denounced the model: “The Government taxes the investment that has not yet taken place, which is completely contrary to the basic logic of the industry.” Worse still, the same funds are being transferred repeatedly within the system and double-counted, while illegal platforms continue to encroach on market shares because of their tax-exempt advantages. The data show that the policy led to a 30 per cent collapse in the Colombian online lottery in 2025. For the first time, the new tax system clearly defined GGR as a total investment less a player bonus, which combined royalties (15 per cent) with VAT (19 per cent), reducing the combined tax burden to about 34 per cent of gross income. In its statement of 31 December, the Colombian Federation of Lottery Enterprises stressed that “the Government has finally recognized the true business logic of the industry”.
At the same time, the Federation noted that the adjustment was only the first step and that the current overall tax burden was still “well above the international average”. The statement added: “This should not be the end, but the starting point for a continuous dialogue with the authorities to build a sustainable long-term model. The restructuring has freed the industry from unsustainable difficulties and created the necessary but limited space for legitimate operations. However, this change is not enough to allow Colombia to establish a highly competitive market that is aligned with the global business model.” The Federation stressed the importance of maintaining a constructive dialogue with the regulatory sector, with the goal of creating an industrial ecology that would attract investment, stimulate technological innovation and create formal employment. “Looking ahead to 2026, the central challenge is to balance a reasonable increase in the State’s fiscal revenues with the sustainable development of the card-holders’ sector,” final appeal.