A new bill in Peru has proposed the increase of the rate of the selective consumption tax (ISC) to 5% of each wager.
The bill, which was proposed by the parliamentary group of the Civic Works Party, would significantly hike the rate of ISC for online bets from the current 1%.
It would remain exclusively applicable to online bets, with land-based gambling spared the tax increase.
The ISC would remain separate from the current 12% gaming tax on the GGR of remote gaming and sports betting operators.
The same ISC rate would apply regardless of where the operator is incorporated, whether in Peru or abroad.
Should the bill be successful, the law would enter into force the day after its publication in El Peruano, the official daily newspaper in Peru. The 5% tax rate would then apply from the first day of the following calendar month.
Renewed tax pressure in Peru
Peru launched its regulated online gambling sector in February 2024, and the market attracted a lot of international interest, with global operators such as Stake, Rush Street Interactive and Betsson receiving licences.
But while the market’s launch is mostly seen to have been a success, optimism has been slightly dented by the enforcement of the 1% ISC since 1 July 2025.
The original policy to include a consumption tax had been scrapped ahead of the market going live, but it was again proposed in 2024, with one lawyer warning iGB its impact would be “catastrophic” for the market’s viability.
Problem gambling and tax revenue drive proposal
The motivation behind the proposal of hiking the ISC to 5% is twofold.
Firstly, the bill highlights the rise of digital betting and its potential impact on public health, with addiction and the protection of Peru’s youth at the forefront.
“The Ministry of Health reported that 14,409 cases of treatment for gambling addiction were recorded at health facilities nationwide in 2025, highlighting the need to strengthen prevention, early detection and specialised treatment efforts,” the bill stated.
“The measure can contribute to a comprehensive policy for preventing problem gambling by increasing the specific tax burden on the activity. The expected benefit is not to position the tax as a solution to gambling addiction, but rather to incorporate an additional fiscal instrument into a broader set of measures covering prevention, regulation, oversight and care.”
Additionally, the bill stated the ISC serves a “revenue-generating purpose”, although it made clear the intention was not to prohibit online betting in Peru.
“Instead, it seeks to moderately raise the tax burden associated with the activity within a market that remains subject to authorisation and regulation,” the bill continued. “The measure is conceived as a complementary prevention tool rather than a sole response to problem gambling.”
The bill included forecasts of just how much the increase of the ISC to 5% could generate.
The ISC at its current rate of 1% generates approximately S/324 million ($94.1 million) a year. At 5%, this could increase to S/1.62 billion, although the bill did make clear that these figures only represented a “static, illustrative scenario”.
Bill highlights other LatAm examples
The bill used examples of other markets in the LatAm region that employ similar additional taxes beyond their primary obligations.
In Argentina, for example, operators pay an indirect tax on online betting of between 2.5% and 15%, while in Colombia, there is currently a 16% VAT on GGR for online operators.
With this in mind, the bill in Peru stated that the rise to 5% for the ISC “does not, in itself, constitute an extraordinary rate within the regional context”.
Operators and bettors could share the tax burden
The proposed increase could have implications for both operators and players, although the extent of the impact remains uncertain.
The bill acknowledged that operators could absorb the higher tax themselves, pass some or all of the additional cost on to bettors through changes to betting conditions, or share the burden between the two.
In Colombia, for example, some operators have been able to mitigate the impact of the additional tax by crediting players with bonuses to offset the VAT’s effect on bettors.