Costa Rica Seeking to Regulate, Tax Online Gambling Ops

by , Aug 31, 2009 | 3:34 am

Funny, here in the USA we’re screaming, “tax us! tax us, dammnit! for all in the name of freedom!” Elsewhere around the world they’re saying, yeah, we should tax … which has some companies considering new homes.

Costa Rica plans to officially introduce a bill this week that has been brewing for a few months to tax and regulate the many online gambling entities with operations there. The assertion is that a 2 percent tax would generate $100 million in revenue. There also was talk of a 1 percent tax on the end users, though it’s not clear if that provision is included in the legislation.

(Does anyone notice how much faster bills seem to move through Congress in Latin American countries?)

An estimated 300-some online gambling purveyors make at least one home in Costa Rica, though some might consider moves to Panama should the new tax pass. Several, such as Bodog, have already moved to Antigua, the UK, and elsewhere.

From AM Costa Rica:

Finance ministry will seek to tax virtual casinos in new bill
By the A.M. Costa Rica staff

The financial ministry is about to present to the legislature a bill to regulate virtual casino operations located in the country. Ministry officials said they hoped to get up to $100 million a year in new taxes.

The disclosure came from Jenny Phillips, the minister of Hacienda in the Comisión de Control del Ingreso y el Gasto Público. The minster pointed out that the virtual casinos are unregulated now. She did not amplify what the bill would contain nor was the scope of the types of gambling to be covered outlined.

The minister said that the bill is part of a campaign against tax fraud and reforms so that the country can take in more taxes. Virtual casinos and online gambling operations are all over Costa Rica. This country and Antigua are the two places with the highest concentration of virtual gambling, the minster said.

There was no indication what provisions would be made to keep the virtual operations, which are highly transportable, from going elsewhere if taxes are levied. Although the operations themselves are not taxed, such businesses employ many local individuals who contribute to the general economy.

More details here, too.

One Comment to “Costa Rica Seeking to Regulate, Tax Online Gambling Ops”

  1. Dan Nedelko

    Thanks for the reference there in the article. It should be noted that Bodog still has an office in San Jose as well (although alot of the core functions have moved).

    One of the other things that comes to mind is the *collection* of the taxes. Sure the CR government may levy the tax but collection of the tax is a whole other ball game.

    I’m still not sure if this is smoke and mirrors yet but it’s interesting for sure.