The Chilean Chamber questions VAT collection on online gambling
The Chilean Chamber of Deputies approved an agreement expressing its concern over the decision by the Internal Revenue Service (Servicio de Impuestos Internos) to allow foreign online betting platforms to declare and pay value-added tax. The initiative, promoted by the Independent Democratic Union (Unión Demócrata Independiente) caucus, received 133 votes in favor, 3 against, and 5 abstentions, according to local press reports. The document highlights a contradiction in the service's June resolution, which enabled a system for the registration, declaration, and payment of digital VAT for foreign platforms without registered domicile or residence in Chile that remotely provide betting, gambling, casino, and similar services, while also demanding the regularization of tax payments corresponding to the last 36 tax periods.
Deputies warned that, while courts ordered the blocking of access to online sportsbooks for operating without legal authorization, another public body established a mechanism for them to register and pay taxes for carrying out that very same activity. One of the proponents of the agreement, Marco Antonio Sulantay, argued that tax collection is not consistent with the legal status of these platforms and called for the suspension of collection until Congress regulates the activity, stating that it is not coherent for the State to tax these betting houses when they are not authorized to operate according to current legislation.
The controversy began in early June when the service announced that online betting platforms without domicile or residence in Chile must register under the simplified regime for foreign digital service providers and begin collecting and declaring the corresponding tax for services rendered to Chilean users. As a result of this decision, 25 international operators completed their registration with the agency to begin complying with the tax obligation, while other companies continue to evaluate their situation. In parallel, the Chilean Association of Casinos and Gaming (Asociación Chilena de Casinos y Juegos) reiterated its objections to the service's treatment, filing an appeal with the Comptroller General's Office, explained by its external legal advisor, Luis Cordero, based on the premise that paying taxes does not equate to being authorized to operate.
The head of the National Renewal (Renovación Nacional) caucus, Diego Schalper, also appealed to the Comptroller General's Office to request a review of the legality of the measure, with a submission that also targets the Government. Although the Executive insists that the service is an autonomous body, party leaders emphasize that it administratively depends on the Ministry of Finance and argue that the decision cannot be disassociated from political responsibility. In response to these criticisms, the service's director, Javier Etcheberry, defended the agency's position before the Senate's Economy Committee, where he maintained that the tax obligation does not imply legalizing the platforms' activity but rather applying current regulations on digital services provided from abroad, regardless of the existence of sectoral regulation, in a debate that continues in parallel with the processing of the bill seeking to regulate the online betting market in Chile.
Tags: Chamber of Deputies of Chile, Internal Revenue Service, VAT collection on online gaming, Javier Etcheberry