Stake’s Bold Move
The Colombian government’s new 19% VAT on online gambling deposits has shaken the industry. Effective February 22, 2025, this emergency tax aims to raise funds for humanitarian relief. But players and operators fear the impact on deposits and legal gambling. To counter this, Stake Colombia launched a “Cashback IVA” promotion, fully offsetting the tax. This ensures players don’t lose funds when depositing. Let’s explore how this works, why it’s a game-changer, and what it means for the industry.
Colombia’s Controversial 19% Betting VAT
The Colombian Ministry of Finance imposed the 19% VAT on gambling deposits under Decree 0175. This law, effective February 22, 2025, removed a tax exemption previously enjoyed by the industry. Now, Colombia is among the few markets taxing deposits instead of operator revenue or winnings.
- Why the Tax? The government expects to generate $3 billion COP for humanitarian aid in Catatumbo.
- Industry Backlash: Operators say the sudden tax leaves no time to adapt. Experts warn this could push players to offshore betting sites with no VAT.
Regulators Coljuegos and DIAN require licensed operators to deduct VAT at deposit time. Players depositing $100,000 COP now receive only $84,000 COP for betting.
Stake’s Cashback IVA: Turning the Tables
A global crypto-based betting giant, introduced VAT Cashback to shield players from this tax.
How It Works on Stake.com.co
- Automatic Reimbursement: The 19% VAT deducted is instantly refunded as a cash bonus.
- Full Deposit Value: Players can bet with the full amount as if the tax never existed.
- Who Qualifies? Every Stake Colombia user on Stake.com.co gets this benefit.
- No Impact on Winnings: Only deposits are taxed, so winnings and withdrawals remain unchanged.
Example Breakdown
| Deposit | VAT Deducted (19%) | Amount Received | Stake Bonus | Total to Bet |
|---|---|---|---|---|
| $100,000 COP | -$15,999 COP | $84,001 COP | +$15,999 COP | $100,000 COP |
| $200,000 COP | -$31,998 COP | $168,002 COP | +$31,998 COP | $200,000 COP |
Players don’t feel the tax’s impact—the casino absorbs it entirely.
How Stake Changed the Game
1. Players Stay Happy
The VAT would have discouraged deposits. With Cashback IVA, players continue betting without feeling the tax.
2. Stake Outshines Competitors
Many operators may struggle to match this offer. If rivals pass the VAT to players, the casino gains an edge with a tax-free betting experience.
3. Keeping Players in the Legal Market
High taxes can push users to unregulated offshore sites. The rebate helps retain players within legal, licensed betting.
4. Industry-Wide Impact
Absorbing 19% per deposit is costly. If competitors follow the brands’s lead, they may demand a regulatory review of this tax.
Global Comparisons
Colombia’s VAT is rare, but similar taxes have appeared elsewhere:
- UK (Pre-2001): Bookmakers once covered a 9% betting tax to retain customers until the government scrapped it.
- Kenya (2019-2020): A steep 20% tax led major operators like SportPesa to exit. Kenya later revised the tax after a legal market collapse.
The strategy mirrors past successes where operators covered taxes to keep players engaged.
What’s Next? Will the VAT Stay?
Colombia’s Constitutional Court will review the legality of Decree 0175. If overturned, VAT deductions will end, and the Cashback IVA may no longer be needed. But if upheld, other operators may need to adopt similar rebates or risk losing players.
For now, players in Colombia get an unmatched advantage: tax-free deposits!
Final Thoughts: A Win for Players, A Challenge for Stake and operators
The VAT Cashback Bonus shields players, ensuring a smooth betting experience. This bold move enhances loyalty, strengthens the operators position, and keeps players in the legal market.
With competitors facing tough choices—absorb the VAT or pass it on—Colombia’s gambling industry stands at a crossroads. Will others follow the lead, or will players migrate elsewhere? Time will tell.
Want to explore similar online casinos? Check out our top recommendations.
Stake’s Cashback FAQ
How does the Cashback work?
The operator automatically credits players with a cash bonus equal to the 19% VAT deducted from deposits. This ensures they receive the full amount for betting, despite the tax.
Who is eligible for the Cashback bonus?
All Colombian players using the brand’s licensed platform Stake.com.co qualify for the Cashback IVA promotion. The bonus is applied automatically to every deposit.
Will other online casinos offer a similar VAT rebate?
Some competitors may introduce their own rebate programs, but many smaller operators may struggle to absorb the cost. Players should check with their preferred platforms to see if similar promotions exist.
