Key Takeaways
- Legal action has been filed with Peru’s Constitutional Court against the Selective Consumption Tax (ISC) by betting industry operators
- The total tax obligation for regulated operators could surpass 50% of their Gross Gaming Revenue
- Between 2025 and 2026, 40 licensed gambling companies abandoned the Peruvian market
- Heavy taxation is pushing customers toward unlicensed international gambling websites
- Industry advocates point to a 2001 Constitutional Court decision on casino taxation as potential legal precedent
Peru’s regulated betting sector has launched a constitutional challenge against taxation laws that operators claim are crushing the legal gambling market and violating fundamental legal principles.
The lawsuit focuses on the Selective Consumption Tax (ISC), which was enacted through Legislative Decree No. 1644 under President Dina Boluarte’s administration. After gathering 5,000 verified signatures through the National Jury of Events, industry representatives secured standing to present their constitutional challenge before Peru’s highest court.
Regulated gambling businesses currently must remit a 12% Gaming Tax alongside a 1% ISC levy on all wagers accepted. Industry analysts calculate that when combined with operational realities, the effective tax rate frequently climbs above 50% of Gross Gaming Revenue.
Market Exodus Accelerates
The financial data reveals an industry in rapid decline.
During the 2025-2026 period, 40 licensed operators completely withdrew from Peru’s gambling market. This exodus was accompanied by approximately 1,500 physical betting locations shuttering their doors.
Corporate sponsorships have similarly collapsed. Football clubs that received support from 18 different betting companies in 2024 saw that number plummet to merely five sponsors by 2026.
Legal scholars specializing in constitutional and taxation law have suggested the ISC implementation may fail to satisfy mandatory legal standards, potentially rendering it constitutionally defective.
Black Market Growth Accelerates
Representatives from the gambling sector argue that excessive taxation is driving customers away from regulated companies toward illegal international platforms.
Offshore gambling sites operating without proper licensing face no equivalent tax requirements. This competitive advantage enables them to provide superior odds and larger returns to players, creating an irresistible incentive for consumers to gamble illegally.
Members of Peru’s Congress are anticipated to examine potential modifications to the legislative decree. Lawmakers hope to strike a balance that preserves government tax revenue while reducing the compliance burden sufficiently to allow legitimate operators to compete effectively.
The results of this legislative review could fundamentally transform gambling taxation policy nationwide.
Historical Ruling May Shape Outcome
Legal analysts are referencing an earlier Constitutional Court judgment that may prove influential in the current dispute.
In Case No. 009-2001-AI/TC, the court determined that specific taxation provisions affecting casinos and slot machine businesses violated constitutional protections. That landmark decision resulted in revised tax requirements and restitution for businesses that had paid under the invalidated framework.
Expert observers believe this judicial precedent could prove significant if the Constitutional Court decides to accept the pending ISC challenge for review.
Both the Constitutional Court and Peru’s legislature now hold the future of the regulated gambling industry in their hands. Their upcoming decisions will determine whether the legal betting market can rebuild or will continue its downward spiral.
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