The Chilean government has introduced a bill to regulate online betting that proposes, among other measures, an additional 3% tax on top of the 19% Value Added Tax (VAT), as well as a ban on advertising by licensed and unlicensed operators and on bonuses and promotional offers designed to attract or retain users.
Submitted within the deadline set by the Senate, the 114-page initiative, titled “Bill to Regulate Online Betting, Protect Children and Prevent Gambling Addiction,” bears the signatures of President José Antonio Kast and ministers Jorge Quiroz, Daniel Mas, May Chomalí, Fernando Rabat and Claudio Alvarado.
The bill stipulates that platforms must apply for a five-year license, subject to an annual fee of 1,000 UTM (Unidad Tributaria Mensual; Monthly Tax Unit), equivalent to roughly US$73,239. Once operational, they will be subject to the 19% VAT, calculated on the difference between the amounts wagered and the prizes paid out each month, plus “an additional tax at a rate of 3%.”
Applications will also be rejected if a company or any related party operated, advertised, or offered services in Chile without the required license “during the 12 months preceding the application.” This would include operators that used a .cl domain, paid sponsorship fees, or entered into agreements with Chilean payment providers.
However, the cooling-off measure will not apply to operators that register under a transitional regime by meeting a set of requirements, including paying an “authorization fee” of 3,000 UTM (US$219,718) and being up to date on their Digital VAT payments.
Operators that conducted transactions subject to Digital VAT before the law takes effect must also declare the tax for “the 36 months preceding the declaration.” Making this payment “shall automatically extinguish any civil, criminal or administrative liability arising from non-compliance with obligations established under tax legislation.”
Another provision would allow land-based casinos to offer betting through online platforms within their premises. This arrangement may only be offered “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.”
Advertising and bonuses
The bill also establishes a ban on advertising online betting platforms “with or without an operating license.” The prohibition would cover “the party commissioning or contracting the advertising, the party designing or producing it, the party disseminating it or allowing it to be disseminated, the party acting as an intermediary in its contracting, and the party personally carrying it out.”
As a transitional provision, the bill allows existing contracts with platforms holding a transitional license to remain in force for up to one year, but only outside hours designated for the protection of minors.
In addition, the text prohibits operators from offering “bonuses or promotional offers” on their platforms, or any other monetary benefit or benefit that can be assigned a monetary value, other than prizes, intended to attract or retain users or encourage betting, even if no advertising is disseminated in connection with the offer.
Chilean Senate
The bill also stipulates that every betting account must be created with “safe gambling settings enabled by default.” These must include, at a minimum, deposit limits for periods defined by the Responsible Gambling Regulations, as well as limits on connection time per session and per day.
New security measures are also required, including “enhanced authentication mechanisms,” such as biometric verification systems. The register of excluded individuals would include people deprived of their liberty, those listed in the “National Register of Child Support Debtors,” and individuals who have self-excluded.
The bill also proposes a ban on betting by athletes, technical staff, directors of professional sports organizations and shareholders, “in all cases in relation to the sporting discipline on which the bet is placed.”
Finally, the proposal calls for the creation of a Fund for the Prevention and Treatment of Gambling Addiction, to be administered by the Ministries of Health and Social Development, as well as Responsible Gambling Regulations to be issued by the Ministry of Finance and reviewed every four years.