Stake Counters New Colombian Taxes with Player Cashback Offer
Stake has said that it is launching a promotion in Colombia designed to refund players the 19% value-added tax (VAT) being charged on deposits in order to ease the impact of the new tax regulation.
LISTEN TO THIS ARTICLE:Through a cashback bonus, Stake will reimburse users the VAT deducted from their deposits under the recently implemented tax measure that took effect this month.
Having entered Colombia’s regulated gambling market in 2023, Stake said that its primary goal is to minimize the financial burden of the new VAT, which applies to every player deposit, no matter the casino payment method.
VAT Introduced by Emergency Legislation
Initially proposed last year, the VAT plan was stopped in December but was later reinstated under emergency legislation (Decree No 0175) issued on February 12. The updated bill removed the previous VAT exemption for online gambling, with the tax requirement officially starting on February 22.
Diana Otálora, Stake’s general country manager for Latin America, explained that it is important to the company to maintain a positive player experience despite the new tax.
That’s why we have to adapt to the government’s measure regarding the 19% tax and comply with the required deadlines. Therefore, we are adopting internal measures so that our customers can continue playing without being affected by this situation.
Related: Colombia Blocks 10,000 Illegal Betting Sites
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Concerns Raised over Impact on Gambling Market
Colombia’s gambling association, Asojuegos, raised concerns about the VAT’s potential impact on the market as early as September. Asojuegos president Juan Carlos Restrepo warned that the measure could drive players toward unregulated platforms.
He explained that by applying VAT, the return to play is reduced from around 93% to 71% to 75%, which is likely to drive players towards international or black-market casinos where the tax isn’t applied.
The Colombian government introduced the tax to fund efforts addressing the ongoing violence in the Catatumbo region, where approximately 80,000 residents have been displaced due to armed clashes between government forces and FARC-EP combatants, according to the United Nations.
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