Remote Gaming and Sports Betting Will Be Subject to the Selective Consumption Tax
Legislative Decree No. 1644 amended Law No. 31557, the law regulating the operation of remote gaming and remote sports betting, to complement the regulation of its tax collection and optimize its application.
Among the amendments to the Selective Consumption Tax Law, these activities will be incorporated into the Value System, a system through which the tax will be applied to the amount obtained from the difference between the total income received and the total prizes awarded in a month, at a rate of 1%.
The Decree also establishes the conditions for considering the player as a habitual resident of the country. This criterion will be considered for the purposes of taxing the transaction with the ISC. In this regard, the regulation considers a player to be a habitual resident when:
- The Internet Protocol (IP) address or other geolocation method assigned to the gambling medium through which the bet is placed corresponds to Peru.
- The country code of the subscriber identity module (SIM) card, physical or electronic, or other technology that replaces it, of the mobile terminal device through which the bet is placed corresponds to Peru.
- Credit or debit cards, or any other means of electronic money, digital wallets, or any other product used by players to deposit money into their gaming account, must be provided by companies within the Peruvian financial system.
- The address registered by the player on the remote gaming and/or remote sports betting technology platform must be located in Peru.
Non-resident legal entities that operate these virtual platforms where games and bets are conducted will be referred to as “Collection Agents,” as they are responsible for collecting, making, and reporting the ISC payment.
In this regard, the regulation includes the role of Payment Facilitators, only if the collection agent fails to report and/or pay the ISC within the permitted timeframes for two or more consecutive months. For its purposes, the Decree considers banks and financial market companies to be facilitators of the ISC payment when gambling payments are made using:
- Credit cards.
- Debit cards or any other means of electronic money, such as prepaid electronic money cards or mobile phones.
- Electronic fund transfers using digital wallets.
- Any other product provided by the aforementioned companies or Banco de la Nación as designated by supreme decree.
- By supreme decree, other entities that receive the amounts of bets made by players may be designated as payment facilitators.
This decree also modifies Section 2 of Article 16 regarding bonuses, establishing that the delivery of welcome bonuses is permitted as long as they cannot be exchanged for cash until a condition is met.
At Thorne, Echeandía y Lema Abogados, we offer the “Tax Advisory Service for Collection Agents and Payment Facilitators” with our tax and accounting team. We are available to answer any service proposal requests, as well as for questions, further information, or clarifications.
Do not hesitate to contact us:
Pilar Santillán Meza
