El Lío: Argentina Ups Online Gambling Taxes by 150%
Argentina’s online gambling sector is said to earn billions per year. But no one can officially say any figure because it is currently almost entirely unregulated.
This new law aims to go some way towards fixing that – with a small tax on every single online gambling transaction to the tune of 5% on the “gross value of each bet and/or game.”
Economy Minister Martín Guzmán confirmed the bill into law this week during National Congress sessions in Buenos Aires. It will also see a 10% tax levied on any foreign operators based in “low or non-existent tax countries,” otherwise known as tax havens.
These changes come as part of the country’s National Budget for 2021. The bill, with all the relevant gambling laws, was passed by 139 votes to just 20 against.
Stability on the Horizon
“Our economy’s recovery with macroeconomic stability is our horizon and the budget, our tool; and the key element in our strategy,” Mr. Martín Guzmán told politicians and reporters after the vote.
Just like many countries globally, Argentina’s economy has suffered during the COVID-19 pandemic. In times of downturn, it is often bookmakers and gambling companies that see taxes and restrictions first – as we have been reporting on all over the world in recent months.
It seems like Argentina is no exception.
This new taxation regime is still a little vague. However, Mr. Guzman (somewhat optimistically) stated that 95% of the new tax revenue would be distributed to the devolved provincial governments rather than spent federally.
The duty of hashing out the details and monitoring or enforcing compliance of these new taxes will fall on two companies.
The state telecoms regulator Enacom will be working in conjunction with the partly state-owned telecoms operator Argentine Satellite Solutions (ARSAT).
Meanwhile, in the very state where this new tax law on foreign operators was passed, Buenos Aires itself is heading towards a completely legal online market in the next year.
Spanish company Codere was the first (and biggest) of 17 applicants to get into the license queue since the potential market was announced last year. As with many countries, including Ireland and the Netherlands, the launch has been delayed by the COVID-19 pandemic.
That would be a double blow for Codero, which has had all its physical betting shops in the country close, too.
Although the legal market would be confined to city residents only (around 3 million people), the hope is it would encourage market legalization at a wider level.
Companies will pay $100,000 a year for access to the market and take a 10% tax. The reasonable number of casinos willing to take that offer shows how appealing full legalization is to legitimate companies.
Despite what politicians may say, hiking up taxes on offshore operators is unlikely to be successful and may even drive those who are based in Argentina offshore.
This point was echoed by the Association of Lotteries, Casinos, and State Quinielas of Argentina in a statement.
Legalize and license the market nationally, and you get rid of both of those problems. It also means more protection for players, which almost everyone can get behind.
For the latest updates on the online gambling scene in Argentina and all the other most important online casino markets worldwide, keep checking our site.