Chilean government proposes 3% betting tax and advertising ban

The Chilean government has submitted a bill to the Senate that would impose an additional 3% tax on online betting on top of the 19% Value Added Tax, ban advertising by licensed and unlicensed operators, and prohibit bonuses and promotional offers intended to attract or retain users. The 114-page initiative is titled "Bill to Regulate Online Betting, Protect Children and Prevent Gambling Addiction" and was submitted within the deadline set by the Senate, according to the text. It bears the signatures of President José Antonio Kast and ministers Jorge Quiroz, Daniel Mas, May Chomalí, Fernando Rabat and Claudio Alvarado.

Platforms seeking to operate would need a licence lasting five years, with an annual charge of 1,000 UTM, a sum the text puts at about US$73,239. After launch, the 19% VAT would be levied monthly on the gap between wagers taken and prizes handed back, and a further 3% would be added. A bid would be turned down where the applicant, or any connected party, ran, promoted or supplied services in Chile without the necessary licence in the year before applying. The same treatment would extend to those who used a .cl domain, paid sponsorship fees or signed deals with Chilean payment providers.

Operators can escape the cooling-off rule by joining a transitional regime and satisfying certain conditions, among them an “authorization fee” of 3,000 UTM (US$219,718) and having no outstanding Digital VAT. Where an operator carried out Digital VAT-liable transactions before the law comes into force, it must additionally declare that tax for “the 36 months preceding the declaration.” According to the bill, settling this amount “shall automatically extinguish any civil, criminal or administrative liability arising from non-compliance with obligations established under tax legislation.”

Land-based casinos would gain the option, under a separate clause, of taking bets via online platforms inside their own venues. Such an arrangement may only be provided “by the operating company through services agreed with the operating company of an online betting platform holding the relevant operating license and the required certification authorizing it to operate.”

Each betting account would have to be opened with “safe gambling settings enabled by default.” At a minimum these must cover deposit limits for periods defined by the Responsible Gambling Regulations, together with caps on connection time per session and per day. Stronger security would also be mandated, including “enhanced authentication mechanisms,” such as biometric verification systems. The register of excluded individuals would list people deprived of their liberty, those named in the “National Register of Child Support Debtors,” and individuals who have self-excluded.