Brazil, Peru, and Colombia will face major elections this year, the outcomes of which could profoundly impact the development trajectory of the Latin American gaming industry. The industry generally believes that compared to left-wing governments, which tend to increase taxes and impose restrictions, right-wing governments are more business-friendly and resistant to tax increases, potentially creating a more stable policy environment for the gaming industry. In plain terms, operators are hoping for the right-wing to come to power to avoid frequent tax increases and advertising bans. Want to know the latest political trends in the Latin American gaming market? PASA's official website keeps track continuously.
Brazil: Lula and the Evangelical Right's "Contradictory Synthesis"
Brazil's electoral situation is the most complex. The current President Lula has approved a gradual increase in gambling taxes to 15% from 2028, but his government has also attempted to tax deposits (although this has been temporarily shelved). Industry consultants point out that Lula is not the best option for operators. However, the right-wing camp also faces contradictions: many conservative politicians have close ties with the strongly anti-gambling Evangelical churches. This clash of "pro-market" and "anti-gambling" values makes the right-wing's gambling policies full of uncertainties. The chairman of the National Gaming and Lottery Association worries that gambling is being seen by the government as a "quick fix" for fiscal deficits, while Artucha warns that politicians are only focusing on taxing the regulated market, pushing players towards the unregulated black market, which is truly "hypocritical".
Colombia: VAT Storm Subsides, Election May Stabilize
Colombia's gaming market is relatively mature, but a sudden imposition of a 19% VAT on online gambling in February last year caused a 30% drop in GGR, causing a major uproar. This tax has now been suspended by the Constitutional Court, and legal experts do not expect it to be reinstated before the elections. Regardless of who is elected, the significant contribution of the gaming industry to the healthy economy (just the physical gaming alone will contribute 378.3 billion pesos by 2025) ensures it has a certain level of protection. Despite the current left-wing President Petro's reforms being stalled and right-wing votes being dispersed, the industry generally believes that the Colombian market will remain relatively stable, and the VAT issue is unlikely to resurface in the short term.
Peru: Political Turmoil Increases Market Uncertainty
Peru will only introduce an online gambling regulatory framework in 2024, previously seen as one of the most attractive markets in Latin America, but the reintroduction of a 1% consumption tax at the end of last year has shaken operators' confidence. Industry insiders describe it as "easy to enter, hard to exit," and subsequent tax discussions are still ongoing, showing that policymakers lack an understanding of the industry's economic logic. Worse still, Peru itself is deeply mired in political turmoil, having changed several presidents in four years, from Castillo's "complete disaster" to Boluarte's impeachment, to interim President Balcázar, the chaotic political situation adds to the bleak market outlook. Although public opinion may lean towards the right, the high level of instability makes any long-term policy difficult to predict.
From Brazil's "value contradictions" to Colombia's "stability expectations" to Peru's "chaotic maze," the elections in these three countries will chart three distinctly different paths for the Latin American gaming industry. Artucha finally calls for politicians to make decisions based on data rather than emotions, arguing that only by making the regulated market competitive can the black market be effectively combated, truly increasing tax revenue.
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This article is from "PASA-Global iGaming Leaders," a gaming industry news channel: https://t.me/pasa_news
Original in-depth gaming channel: https://t.me/gamblingdeep
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PASA official website: https://www.pasa.news
