Peru's Regulated Betting Sector Moves to Overturn Selective Consumption Tax

Peru's online betting industry is taking legal action against the country's Selective Consumption Tax (ISC), after securing the required 5,000 verified signatures to bring a constitutional challenge before the Constitutional Court.

The case focuses on the 1% ISC introduced under Legislative Decree No. 1644. Industry representatives argue the levy may breach constitutional tax principles, with legal experts questioning whether it satisfies the necessary legal framework.

Licensed operators are already subject to a 12% gaming tax, and the addition of the ISC has significantly increased the overall tax burden. Trade bodies claim the combined impact can exceed 50% of gross gaming revenue (GGR), placing further pressure on regulated businesses.

The sector says the effects are becoming increasingly visible, citing dozens of operator exits, widespread betting shop closures and a sharp decline in sports sponsorships since the tax regime came into force.

Operators have also warned that rising compliance costs are strengthening the position of unlicensed offshore gambling sites, which are able to offer more competitive odds without facing the same regulatory obligations.

The constitutional challenge comes as Peru's Congress considers possible amendments to the legislation. Legal observers have pointed to a previous Constitutional Court ruling that struck down parts of the country's casino taxation regime, suggesting it could provide an important precedent in the latest case.

The court's decision, together with any legislative reforms, is expected to have significant implications for the long-term development of Peru's regulated betting market.