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Chile’s march towards online gambling regulation continued on Tuesday (April 2) as the Senate economy committee heard from gambling lawyer and expert Cristina Romero, Heidi Berner from the Ministry of Finance and the Undersecretary of Telecommunications (Subtel) as each fought their side over enforcement and taxation.
Romero, a lawyer at Loyra Abogados who works with the online platforms, held their long-standing line: that the tax burden is too high and it will affect channelisation. She argued that there should only be one tax for operators.
As the text of the bill stands, 19 percent of gross gambling revenue will be taxed, in addition to a 1 percent contribution to responsible gambling, plus 20 percent of gross income as a specific activity tax, as well as 2 percent of gross income to sports federations.
Romero cited other countries' tax policies and channelling rates to argue for a lower tax rate, using the United States as an example, where 29 percent of the market in 2023 was legal, according to the research of YieldSec.
Peru and Brazil were also invoked as local examples of models to follow, which both initially had higher tax rates but then were lobbied down — in the latter’s case with heavy influence from the Institute for Responsible Gaming (IBJR), which features heavyweights of the online industry.
Subtel, for its part, reiterated to the Senate that it does not have the actual power to regulate or enforce penalties. It referenced during the presentation the case in September, in which the Supreme Court ordered telecomms provider Mundo Pacífico to shut down the sites of 13 gambling providers.
“Subtel does not regulate content, except for supervision under the provisions of the law on net neutrality,” it wrote.
“Consequently, the Undersecretariat informs the ISPs [Internet Service Providers] registered in the country of the failure and the illegality of the listed betting sites, and the ISPs proceed to block access to them," Subtel said, making note of the difficulties with this system, as common workarounds include easily available VPNs, permanent IP changes and DNS masking.
Subtel also warned that the success of blocking will come down to cooperation from ISPs and the capacity of the government to enforce the measures.
The Ministry of Finance, for its part, announced that it had taken the opportunity to introduce a National Responsible Betting Policy, which will be informed by reports from the Ministry of Health and the Superintendency of Gaming Casinos (SCJ). It will apply not just to online operators but the entire industry, including already legal and established land-based casinos, which are governed by the SCJ.
The Senate’s economy committee will continue hearings on the matter at the end of the month.
