Thread: Costa Rica May Change Online Gambling Laws

Reports Hint that Taxation May Be Coming

From the CAP News page:

September 2, 2009 (CAP Newswire) -- According to Costa Rica’s newspaper AM Costa Rica, lawmakers in that Latin American nation are considering a new law that would regulate and tax online casino operations there. That would come as a significant development, given Costa Rica’s current status as one of the few nations where Internet gambling businesses are allowed to operate without taxation.

It makes sense, though: The country’s finance ministry is coming to the realization that if it taxes the many online casino businesses based in Costa Rica, it could be taking in a huge amount of cash. Some estimates are as high as $100 million a year; that’s the kind of figure that will get the attention of any politician.

However, new taxation may complicate the fact that many jobs have been created in the country because of the online gaming businesses, and those jobs may be at risk if the nation were to cut into the revenue of the operators. In that case, the country could see those online gambling firms leave to a more hospitable country, and risk the loss of a not insignificant sector of its economy.

Much as I love Costa Rica, I'm skeptical that they could provide "regulation" for that $100 million.

Originally Posted by Nathan

It makes sense, though: The country’s finance ministry is coming to the realization that if it taxes the many online casino businesses based in Costa Rica, it could be taking in a huge amount of cash. Some estimates are as high as $100 million a year; that’s the kind of figure that will get the attention of any politician.

However, new taxation may complicate the fact that many jobs have been created in the country because of the online gaming businesses, and those jobs may be at risk if the nation were to cut into the revenue of the operators.

In that case, the country could see those online gambling firms leave to a more hospitable country, and risk the loss of a not insignificant sector of its economy.

You answered your own question perfectly.

Gambling companies do NOT choose Costa Rica for it's location, infrastucture, or weather advantages ... Costa Rica is chosen for it's tax advantages.

Perhaps, just perhaps, a tiny nibble at these profits might be acceptable if the money is then put into providing a 1st world computing infrastructure, with upgraded power, cabling, and so forth - and (ahem) regulation of course.

if the local government tries to rort these companies harder and they'll simply slip off to the next location.