In only a few short months, Peru has made significant progress with its online gambling initiative. It started in March, and advanced again this week.
The legislative initiative that regulates online sports betting, which the Council of Ministers already unanimously approved, is now going to its fourth committee review. This follows a debate of approximately one hour in the Foreign Trade and Tourism Commission (CCETC, for its Spanish acronym).
The commission liked the idea of a 12% tax on the income of remote bookmakers. However, a call for further review by additional government entities will influence what happens next.
Extensive Review Underway
Several parliamentarians said that they should have the opinions of other government entities before they can sign off on the measure. Among those they want to include are the Ministry of Economy and Finance, the Chamber of Commerce of Lima and other specialized entities. The project is already with the Economy, Banking, Finance And Financial Intelligence Commission.
Local media reported that, at the end of the debate, CCETC President Germán Tacuri acknowledged and accepted the request for additional reviews. He added that they will provide valuable insight and ensure that the legislation is properly framed for approval.
Tacuri explained the breakdown of the 12% tax, which operators will pay on their net income. 40% will constitute income for the public treasury, 20% for the Peruvian Institute of Sport and 40% will go to the Ministry of Foreign Trade and Tourism (Mincetur, for its Spanish Acronym).
Of the total resources that it receives, Mincetur will use 25% for the administration of the online gambling market. The remain 75% is for the promotion and development of tourism.
The initiative also proposes that Mincetur be responsible for granting authorizations for the use of technological platforms in games and sports betting, as well as in physical premises. This will require companies to register in the Single Registry of Taxpayers, which facilitates tax collection and government oversight.
Those companies must also have a legal representative in Peru. Lastly, the web domain of their platforms must have the ending “.pe.”
Shaking the Moneymaker
In 2020, remote sports betting generated a movement of PEN$4.5 billion (US$1.2 billion). This was the result of approximately 150,000 daily bets. However, because online gambling is still illegal in the country, Peru cannot collect any tax revenue from the activity, and all that capital heads outside its borders.
Mincetur believes that the government can raise as much as PEN$160 million (US$42 million) a year with this measure. The portfolio estimated that in 2022, bookmakers would move PEN$4 billion (US$1 billion).
Mincetur also recently pointed out that, in the last 16 years, the State collected around PEN$3.4 billion (US$912 million) through gambling. This is only what it received from casinos and slot machines.
Eduardo Sevilla, general director of Casino Games and Slot Machine of Mincetur, stressed that the industry was able to resist the COVID-19 pandemic and that it has been gradually reactivating. This also means more jobs are coming to the public.
Also, according to the statement, in 16 years, the provincial and district municipalities received more than PEN$2 billion (US$526 million). For its part, Mincetur collected more than PEN30 million (US$8 million) from the application of fines.
Currently, Peru has 17 casinos with 235 gaming tables. In addition, there are 713 gambling halls, 59 hotels and 145 restaurants with a total of 70,844 slot machines.
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