Colombia Adds 16% Online Gambling Tax to Fund Flood Relief

Colombia has reinstated an online gambling tax of 16% on all wagers placed through digital platforms. President Gustavo Petro signed Decree 0240 after severe flooding hit eight provinces, damaging homes, roads, and public infrastructure. The measure is expected to raise an additional COP8.6 trillion, roughly $2.3 billion, for the 2026 national budget. That money goes directly toward disaster recovery efforts in the affected regions.

How the Tax Works

The 16% levy is a consumption tax. It applies to the total amount wagered on digital platforms, minus any prizes paid out. Both domestic operators and international platforms serving the Colombian market fall under the decree. Petro signed it under a declaration of national economic emergency, which allowed his government to bypass the standard legislative process and act quickly.

Officials pointed to the online gambling sector’s strong revenue growth as justification for the levy. The argument was that the sector could absorb the charge without placing undue pressure on other parts of the economy. The tax is described as temporary. Broader fiscal reform may follow depending on how the government’s budget situation develops through the rest of 2026.

What Else Is in Decree 0240

The gambling tax is the most visible part of the decree, but it covers several other fiscal measures. Taxpayers with outstanding balances as of December 31, 2025 can reduce their penalties by settling in full before April 30. Under those terms, interest rates drop as low as 4.5% and only 15% of the original penalty applies. That relief covers tax, customs, and foreign exchange obligations.

A separate regularization tax for undeclared assets or non-existent liabilities takes effect on April 1, 2026 at a rate of 19%. Foreign company branches and permanent establishments face new wealth tax filing requirements, with payments due in two installments across April and June. Healthcare organizations, companies under state intervention, and public utility firms in declared emergency zones are exempt from several of the decree’s provisions.

Colombia Has Done This Before

This is not the first time the government has turned to online gambling during a national crisis. In February 2025, a 19% VAT on online gambling deposits was introduced in response to unrest in the Catatumbo region. The impact was immediate and severe. The Federation of Gambling Entrepreneurs reported a 30% drop in online gaming revenue in the months that followed. Attempts to make the VAT permanent failed in December 2025, and the Constitutional Court suspended it over constitutional concerns.

The government addressed the obvious legal question inside the decree itself. Its position is that using a tax measure during one emergency does not prevent the same approach in a separate crisis. Each emergency is treated as legally distinct. That argument may face scrutiny, but for now the decree is in force.

What Operators Are Watching

The 16% rate is lower than last year’s 19% VAT, but that offers limited comfort given what happened before. A 30% revenue decline set a painful precedent for what a Colombia online gambling tax can do to the market. Operators are monitoring enforcement closely and watching for any legal challenge that mirrors the pattern of 2025.

Colombia has one of Latin America’s most developed regulated online gambling markets. That visibility makes it a recurring target when emergency funding is needed fast. The broader region is paying attention too, as the trend of tapping digital gaming revenues during national crises continues to grow. For now, the 16% consumption tax is live and operators must comply. How long it stays in place, and whether the courts intervene again, remains an open question.