Peru’s Online Betting Industry Challenges the Constitutionality of Selective Consumption Tax

Peru's online gaming and betting industry has reached a significant procedural milestone in its effort to overturn the Selective Consumption Tax (ISC), a levy imposed on betting activities through Legislative Decree. The sector has successfully certified the 5,000 signatures required to file a constitutional lawsuit with Peru's Constitutional Court, marking a formal escalation in the industry's dispute with the tax regime.

The ISC on betting represents a contentious policy issue in Peru's evolving regulatory framework for online gaming. Operators have argued that the tax burden is disproportionate and undermines the competitiveness of the legal, regulated market against unlicensed alternatives. By pursuing a constitutional challenge rather than seeking legislative amendment, the industry is questioning the fundamental legality of the tax structure itself—a more aggressive legal posture that could have broader implications for Peru's gaming taxation model.

This move reflects growing tension between Peru's government revenue objectives and industry stakeholders' concerns about tax sustainability. Many Latin American jurisdictions have grappled with similar questions: how to generate meaningful tax revenue from online gaming without driving operators or players toward unregulated markets. Peru's approach thus far has favoured higher taxation, but the constitutional challenge suggests operators believe the current burden exceeds constitutional limits or violates principles of proportionality and fair taxation.

The certification of signatures and filing of the constitutional lawsuit will now enter Peru's court system, where judges will evaluate whether the ISC violates constitutional protections. The outcome could reshape Peru's gaming tax landscape and set precedent for how other Latin American nations structure online betting levies. If the Constitutional Court rules in the industry's favour, Peru may be forced to restructure or reduce the tax, potentially lowering government revenue but potentially also expanding the regulated market.

For operators licensed in Peru, this legal action represents both hope and uncertainty. A favourable ruling could improve margins and competitiveness; an unfavourable one could entrench the current tax regime and prompt strategic recalibration. The case will likely draw attention from regional regulators and operators monitoring tax policy trends across Latin America.