⚠️ Chile 🇨🇱: tax authority outlines how it will enforce VAT if foreign online betting operators fail to comply

⚠️ Chile 🇨🇱: tax authority outlines how it will enforce VAT if foreign online betting operators fail to comply

Although Chile has yet to approve a law specifically regulating the online gambling sector, the country's tax authorities have already established a mechanism to ensure the collection of VAT on these transactions.

🔸 Current situation: more than one month has passed since the publication of the regulation establishing the tax calculation rules, yet no online operator has voluntarily registered in the registry created for this purpose.

🔸 New strategy of Chile's Internal Revenue Service (SII):

🔹 Responsibility for withholding the tax will fall directly on the payment system used by the player. As a result, banks, card issuers, and other financial institutions will be required to withhold the applicable 19% on every transaction related to bets placed through unregistered foreign platforms.

🔹 VAT compliance will be monitored through the cross-checking of banking and non-banking data.

🔸 Background: the enforcement framework is not being built from scratch. The SII is leveraging the experience it has gained since 2021, when VAT was introduced on digital services supplied by foreign platforms, including streaming services. Since then, the authority has developed mechanisms to identify operators by analyzing transactions carried out using debit cards, credit cards, prepaid cards, and other payment instruments.

🔸 Taxable base: as a general rule, VAT will be calculated on the actual remuneration received, meaning the total value of bets placed by individuals residing in Chile.

🔸 Exception: if a platform can provide sufficient evidence to the SII of the prizes paid to players, the taxable base will be reduced to the total amount wagered minus the prizes actually paid. In either case, the standard 19% VAT rate applicable to these transactions will apply.

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