ProntoPaga will cut service to betting operators that do not pay VAT
The tax deadline on Tuesday, October 20 sent a clear signal that came neither from the regulator nor the courts, but from a payment provider. ProntoPaga announced that it will cut off from its infrastructure any online sportsbook that, despite being listed on the Servicio de Impuestos Internos (SII) registry, has not paid digital VAT, stressing that there will be no exceptions.
Teresita Valverde, legal counsel for the company, framed it as an obligation of the digital payments ecosystem: a company in the sector cannot allow its infrastructure to be used by firms that owe money to the tax authorities. "This decision is firm and without exceptions," she stated, as reported by Diario Financiero. The company clarified that operators who are up to date with their obligations will be able to continue using its services without disruption.
The decision builds on a series of administrative actions implemented by the SII throughout the year. Resolution No. 69 required all online betting platforms without a registered address or residence in the country to enroll in the simplified tax regime Chile reserves for foreign digital service providers, and to collect and declare VAT on amounts billed to Chilean users. Twenty-five international operators completed that registration.
The second step was more intrusive. Through Exempt Resolution No. 94, the agency updated the list of foreign taxpayers subject to the taxpayer substitution mechanism, under which the withholding obligation shifts to payment method issuers—including debit and credit cards—when the platform is not enrolled in the simplified regime. Under this framework, the intermediary deducts 19 percent VAT on each transaction and remits it monthly to the treasury. The withholding applies from August 1, 2026.
The SII explained that its detection capabilities rely on experience gained since VAT was extended to digital services in 2021, combined with data provided by banks and payment processors—information that helps identify which platforms are processing transactions with users based in the country. During 2025, the agency recorded more than four million transactions from the leading online sportsbooks in the country. This figure explains why the payment channel has become the most effective checkpoint: the financial flow is traceable even when the operator is not.
What ProntoPaga's announcement highlights is the sequence in which Chile is establishing control over the sector. First the tax registry, then payment method withholding, now a commercial decision by a processor refusing to serve non-compliant operators, alongside court-ordered blocks and ongoing legal challenges faced by Subtel. The legal framework, however, remains nonexistent: the bill to regulate online betting is still making its way through congress, with unresolved differences over the regulatory model and market entry requirements, and the Executive branch must submit its amendments before October 26.
ProntoPaga is a Chilean payment processing fintech that acts as an intermediary between online merchants and local payment methods across several regional markets, with online gambling among its client verticals. Its decision aligns the company with the SII in a market that does not yet issue licenses, where tax compliance effectively serves as the only seal of legitimacy available to a foreign operator.
Tags: Chile, ProntoPaga, SII, VAT, Payments, Payment Processors