lmost a year ago, the Buenos Aires Province’s economic team decided to create two different taxes on online gambling in the territory, with which they expected to add 2.5 billion pesos (USD 43 M) to the provincial treasury. But no significant progress has been made in that regard, even though the planned deadlines passed weeks ago.
There are currently fifteen applicants competing for the seven licensees available to operate in that territory.
The 2019 Tax Act, which governs this activity, states that the Province's executive branch will oversee online gaming operations through the Buenos Aires Province Institute of Lotteries and Casinos (IPLyC in Spanish) and to that end, the government created the Online Gaming Licenses Registry to keep a record of license holders. However, IPLYC officials have not made comments on the current state of the licensing process.
Applicants are not sure if the process will be finished before general elections, now that a change in the Federal and Provincial administrations is almost certain. In fact, a source has told Yogonet it is highly likely that authorities will just issue an unofficial evaluation of the best seven proposals.
On top of the political uncertainty, there is also concern over the current economic scenario in the country after the recent devaluation of the Argentine peso, as many multinational companies have invested in dollars and will now receive returns in a severely depreciated currency.
Most of the questions revolve around how the new administration would deal with online gambling if Frente de Todos candidate Axel Kicillof wins the general elections in October and becomes the new Buenos Aires Province Governor, as the representatives of his political party in the Legislature were opposed to the regulation of this modality.
Industry experts have pointed out that for the licensing process not to lose legal validity, the future license holders should be selected before the new budget is issued as the taxation on this activity has already been contemplated in this year’s budget.
Codere expresses concern over the Argentine crisis
Amid this complex political and economic scenario, Grupo Codere (one of the applicants for a license in Buenos Aires Province) has issued a press release on the current situation:
"Given the recent economic measures taken in Argentina after the primary elections, which included a severe devaluation of the Argentine peso as well as the deterioration of the national debt and shares traded in the country’s stock market, the Company is herein sharing with the public information related to the impact of our local segment as well as the devaluation of the Argentine peso on the consolidated financial results for 2019." The company saw a 29% drop in profits within the Argentine segment.