Codere Online has confirmed that it will halt all further investment in Colombia unless the government changes its current tax policy.

The decision follows the introduction of a 19% VAT on all online gaming deposits by President Gustavo Petro’s administration in February.

An intervention by Petro saw the Colombian government increase taxes to raise emergency funds for Catatumbo, a province destabilised by guerrilla conflicts. Initially billed as a temporary measure, it was made permanent in September by Finance Minister Germán Ávila.

“We are not going to invest any further unless the tax changes. Our three- and five-year plans do not include Colombia,” said Moshe Edree, Executive Vice President of Codere Online, during the company’s Q3 2025 investor presentation.

All against Petro Tax Strike

2025 has been a miserable year for Colombian gambling. The market, once hailed as one of the fastest-growing in Latin America, is now under strain as operators grapple with a measure trade bodies describe as “unsustainable”.

Evert Montero Cárdenas, President of Fecoljuegos, stressed that operators are reaching a breaking point: “It’s an unsustainable burden from a financial standpoint. Operators have been forced to grant bonuses to absorb the VAT impact and avoid passing it on to users.”

The Spain and LATAM operator has already felt the damage of the new regime, with net gaming revenue from its “other” markets – covering Colombia, Panama and Buenos Aires – down 32%, mainly due to a €1.4m fall in Colombian income. The figures reflect a wider decline across local operators’ real operating performance, even as deposits have held steady.

Outgoing CFO Óscar Iglesias noted there may still be a window for change as Colombia moves toward its May 2026 elections. “It’s unclear what direction those elections will take.

“Even if the tax is approved, more centrist or right-leaning parties could come to power and repeal a measure that has failed to generate additional fiscal revenue,” he told investors. Iglesias will be replaced by Marcus Arildsson, appointed Group CFO effective 13 November.

Opponents of the measure have warned President Petro that the ultimate test will be whether the VAT charge undermines the sector’s legislative duty to deliver reliable contributions to Colombia’s healthcare system — the key justification for launching a regulated online market in 2017.

That argument is supported by Coljuegos data showing a steep 46.6% year-on-year decline in monthly contributions, from COP 43.3bn (£9m) in July 2024 to just COP 23.1bn this year. The government had projected VAT income from gaming deposits to reach COP 1.6tn, but that target now looks increasingly out of reach.

Should revenues fall short, the policy may have to be reconsidered – potentially reopening a viable path to profitability in a market where Codere Online is struggling to gain traction.

Overall, Codere Online believes it has returned to a more stable trading and performance in 2025, with leadership planning to double share buybacks to $7.5m. Net gaming revenue remained flat at €51.6m in Q3, as performances in Spain and Mexico held steady despite a 39% rise in monthly active players in Mexico.