Colombia’s 19% value-added tax (VAT) on gambling has been paused after the country’s Constitutional Court suspended the emergency decree.
On 29 January, Colombia’s Constitutional Court suspended Decree 1390, which last year declared a “state of economic and social emergency” in Colombia, citing concerns over its constitutionality.
The decree included a number of measures, including a 19% VAT on gross gaming revenue from online gambling. The VAT, originally placed on deposits, was first introduced last February and was intended to cover the cost of tackling civil disturbance in the Catatumbo region.
The Constitutional Court’s decision meant that all of Decree 1390’s measures were suspended immediately, with online gambling now subject only to the standard 15% GGR tax.
The suspension will last until the Constitutional Court’s plenary chamber makes a final decision on the emergency decree.
Juan Camilo Carrasco, managing partner of Sora Lawyers, described the move as “unprecedented” in a LinkedIn post published on Friday. This is the first time in Colombia’s constitutional history that the court has provisionally suspended such a decree.
What happens next?
Speaking to iGB on the suspension, Carrasco outlined the three potential scenarios for the sector.
The first, and most favourable for operators, is that the VAT exemption prevails, leaving companies liable only for the 15% gambling tax.
According to Carrasco, early indications suggest this outcome is the most plausible, given the court’s concerns over whether the fiscal situation met the constitutional threshold required to invoke emergency powers.
“The government would then likely defer any new gambling tax proposals to a normal legislative process at a later date (after the 2026 elections),” Carrasco said.
The second scenario is that the VAT will return, but will once again be based on deposits. However, this will require new legislation or another decree, due to the previous measure expiring on 31 December 2025 before the government shifted the VAT onto GGR.
Carrasco said this scenario is “improbable in the near term”.
The final scenario is that the government attempts a conventional tax law to reintroduce the VAT on GGR.
However, according to Carrasco this is also unlikely as 2026 is an election year in Colombia. This means passing new taxes is “politically challenging”.
The government had already attempted to make the 19% VAT on deposits permanent, but its Financing Law was rejected by the Senate’s Fourth Committee by a 9-4 vote in December 2025.
Carrasco said Colombia’s central government is furious at the suspension of Decree 1390, explaining: “The defeat of the 2025 tax reform bill and the resort to emergency decrees shows Congressional resistance to further tax hikes on the industry.
“It’s plausible that no new legislation will be enacted until the next administration (2027 onward). Nonetheless, we cannot rule out a scenario where later in 2026, if fiscal pressures mount, a scaled-down tax measure is proposed,” he concluded.