Colombia Targets Gambling and Digital Platforms in Push to Close $18 Billion Tax Gap

Colombia’s tax authority, the Dirección de Impuestos y Aduanas Nacionales (DIAN), confirmed that tax evasion drains nearly COP 72 trillion (≈ $18 billion) from public finances every year.

Acting director Luis Eduardo Llinás announced that the government will seek COP 26.3 trillion (≈ $6.6 billion) in new revenue through a reform bill, focusing on online gambling, digital platforms, and virtual asset providers.

Officials already collect a 19 percent value-added tax on deposits in betting accounts under Decree 175 of 2025. The government now wants to make this levy permanent through the reform.

Authorities argue that online betting generates significant revenue and must operate under clear, permanent tax rules. To accelerate cash collection, the government also adjusted withholding and self-withholding rules through Decree 572 of 2025.

Officials expect these changes to capture part of the income tax in advance, especially from sectors with high margins. At the same time, DIAN is increasing audits in mining, energy, and digital services, which it considers underreported or misreported.

The revenue challenge is pressing. Colombia had set a 2025 net collection target of COP 280.3 trillion (≈ $70 billion) but recently lowered it from COP 298.9 trillion (≈ $75 billion).

By mid-year, DIAN had collected about COP 135.4 trillion (≈ $34 billion), leaving a large gap to close before December. Llinás emphasized that DIAN has processed more than 1.2 million income tax returns this year without major technical issues.

However, the current MUISCA system, which manages filings, faces obsolescence. DIAN confirmed it will replace MUISCA with a New Core Tax System (NSGT) by December 2028.

The modernization program carries a $250 million budget, mostly earmarked for digital security and technological upgrades. Public response has been divided.

On social platforms, many users argue the deposit-based VAT makes betting more expensive, while some operators claim gross income has fallen by more than 30 percent.

Authorities insist the measure ensures fair contribution from a fast-growing industry that had previously escaped effective taxation. The reform debate matters beyond gambling.

It shows how Colombia aims to plug fiscal gaps by targeting sectors that grew quickly outside traditional oversight. The government believes stricter enforcement and digital modernization can help secure revenue.

It also expects permanent levies to stabilize finances and expand services. For businesses and consumers alike, the rules of the game are changing, and compliance is no longer optional.

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