Peru Considers Taxing Online Gambling and Sports Betting, Granting Closure Powers to Mincetur

A proposed bill in Peru, identified as No. 9645, aims to impose a tax on companies involved in remote gaming and sports betting, encompassing online sportsbooks and internet gambling platforms. The bill also seeks to authorize the Ministry of Foreign Trade and Tourism (Mincetur) to close and confiscate equipment in betting establishments that lack proper authorization.

The legislative proposal, put forth by Congresswoman Lady Camones of the Alianza Para el Progreso (APP) party, intends to modify the General Sales Tax and Selective Consumption Tax Law to ensure these businesses pay taxes.

The proposed amendment would include “games of chance and betting, such as remote games and remote sports betting, casino games, slot machines, lotteries, bingos, raffles, sweepstakes, and horse racing events” within the scope of the law, thereby making these activities subject to the Selective Consumption Tax.

Currently, the law does not explicitly address online gaming. Therefore, “the tax will be applied to the difference between the total revenue received in one month from games and bets involving money and the total prizes awarded during that month.”

This means that lottery, bingo, raffle, sweepstakes, horse racing, and remote gaming and sports betting companies would be required to make monthly tax payments.

Sports Betting Equipment Subject to Seizure

The bill also seeks to amend Law No. 31557 to empower Mincetur to “close establishments whose operators do not have express authorization, and may request the support of police authorities.”

Mincetur would also be authorized to “proceed with the confiscation of gaming terminals that do not meet the established technical characteristics, and may request the support of police authorities.” In essence, Mincetur would have the power to close gaming establishments, whether for sports betting or other games of chance, and seize gaming terminals, all with police assistance. Currently, Mincetur does not possess these powers.

What Constitutes Remote Gaming?

Law 31557 defines remote games as games of chance conducted remotely that involve placing bets and are developed on technological platforms using electronic, telematic, computer, or interactive means, and are transmitted through open or restricted communication networks such as television, the internet, fixed or mobile telephony.

The same law defines remote sports betting as games of chance conducted remotely on technological platforms where bets are placed on the outcome of a sporting event or any other fact or circumstance that may occur during said sporting event.

While they may seem similar, the distinction lies in the fact that “remote sports betting” relates to the outcome of a sporting event, while remote games encompass all other games of chance not included in that definition, such as slot machines, card games, and other online games of chance.