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Ecuador's President has enacted a decree to reform the country's sports-betting taxation regime and introduce a licensing framework.
Under , sports-betting licences will be valid for five years and cost 655 unified basic salaries, which is currently equivalent to US$307,850.
A sports-betting tax previously introduced in 2024 as a self-registration system has now been formalised by the decree in the form of a single income tax of 15 percent based on operators' gross income minus prizes paid to players. A 15 percent income tax on prizes paid to players will also be applied as a withholding tax. Notably, operators need to pay and declare withholding tax.
As of September, 65 sports-betting operators had registered to pay the tax, which was introduced by the Ecuadorian tax service (SRI) to glean income from the grey market. At the time, Damián Larco, the director of the SRI, said he suspected the number of offshore operators to far exceed that and he hoped to block them.
Santiago Alban, an Ecuadorian lawyer at with HEKA law firm, expressed concern to ϲ̳ GamblingCompliance that the government has chosen to now regulate by decree instead of through a bill and subsequent legislative process in the National Assembly.
“We are worried that the government has not taken this seriously. And by this, I mean that we need to work on a very specific licensing process like in Peru and Colombia,” he said.
Alban also said that the process of drafting a bill and approving a law was necessary for player protection and to determine what was best for the industry.
“Even for ethical purposes, for responsible gaming, we need to first work on the basis of the licence. What is going to be needed? How is the government going to interact with the [certification] labs? What labs are going to be qualified? How is the player going to be protected with his licence? And with all that in mind, have a law, because it is not a matter of ruling just with an executive decree. You need to have a law. You need to have rules. You need to have public policy.”
Ecuador outlawed gambling entirely in 2011 aside from its national lottery, but sports betting was essentially legitimised in 2020 after it was ruled that sports wagering was a type of forecasting not subject to the blanket ban on gambling.
In 2023, the SRI announced plans for a basic tax regime. At the time, Francisco Briones, the head of the SRI, said in an interview that regulation “is not a priority right now, but we are working on it. We’ve observed external allies trying to regulate as the first step, to know more about the regulation around Latin America. And then we will work on a text for a new law.”
Alban also suspects that broader political considerations have prevented a bill from being presented, as the presidential elections are due to be held in April. “It is also important to understand because we have a political component to this matter,” he said.
