Chile Moves Betting VAT Collection Into Payment Flows
The Servicio de Impuestos Internos (SII) reported that the registrations took place on July 14 and 15. They followed a warning from the agency that it would assign VAT collection duties to payment operators when a betting portal site does not belong to the simplified taxation system.
Domains associated with betting sites, including Betway, Betano, 1xBet, Novibet, Betsala, Jugabet, and DoradoBet, have been listed. Several legal entities have been listed under various domain names. Thus, this list contains both platform domains and the firms registered for taxation purposes.
Resolution Separates Registered Operators
The registrations represent the first clear response from operators since Chile opened the Digital VAT route to offshore betting and casino businesses in June. The previous measure introduced an obligation for foreign firms to register, declare, and pay Digital VAT directly. Resolution No. 94 adds ten betting-related merchant names to Chile’s existing Digital VAT withholding list.
Registered firms are still required to file the VAT declarations by themselves. SII will analyze the payment data to check the correspondence between declared figures and real activity of firms in Chile.
Ten Names Enter the Withholding List
SII also identified ten unregistered entities or platforms that will become subject to tax collection at the payment level. The list includes:
- bet365;
- Stars;
- 1Win.com;
- ElectraWorks;
- TheLotter;
- PokerStars;
- GGPoker;
- Betcris;
- LeoVegas;
- Roobet.
For every payment made to the above-named organizations, the payment intermediary will be responsible for making the tax collection. The 19% VAT should be withheld on the respective transactions and paid to the Treasury monthly.
Payment Providers Join the Enforcement Process
Payment-method issuers and operators will act as withholding agents for transactions linked to the listed merchant names. SII has created the list based on the information provided by the above companies and by the payment method operators. Transactions linked to an unregistered gambling operator can therefore become subject to VAT withholding within the payment process.
The new procedure makes it unnecessary for the authority to depend on the declarations made voluntarily by offshore operators. It also gives SII a collection point within Chile’s financial system.
Card Data Expands the Audit Trail
From 2021, Chile has used payment information to implement Digital VAT for foreign services. As per SII, debit, credit, and prepaid card transaction data has assisted the agency in identifying online betting platforms serving customers domiciled or resident in Chile.
The agency will now analyze the data provided through the registration process. It will then match VAT declarations and payments with the provided transaction information.
Automated Checks Will Compare Tax and Turnover
Carolina Saravia, SII’s deputy director of audit, explained that automated processes will check the registration process and confirm if the platforms have paid the right amount. The crucial factor will be whether what has been declared by the platform is consistent with what the authority can see from its payments. Differences between declared VAT and transaction volumes could lead to further scrutiny.
Chile is moving from registration to payment-level enforcement. From August 1, payment-method operators will apply the withholding mechanism to transactions linked to the ten names added by Resolution No. 94. SII will also compare the filings of registered platforms with data received from payment providers. The measure addresses tax compliance only and does not grant the operators a gambling license or determine whether their services are lawful.