Peru – Peru court denies appeal to scrap additional tax
A claim lodged in a Peruvian court claiming that a new tax on casinos and slots is unconstitutional has been rejected. The claim failed to garner the support of the five votes necessary meaning that the tax will remain in force.
Magistrates Marielena Ledesma, Eloy Espinoza and Manuel Miranda ruled on the constitutionality of Legislative Decree 1419, which established a new tax on table games and slot machines in 2019. As a result the demand was considered to be “unfounded”.
The rapporteur of the case, José Luis Sardón, along with Ernesto Blume and Augusto Ferrero, voted in favour of the lawsuit filed by a group of more than 7,000 citizens. Magistrate Carlos Ramos issued a statement that declared the lawsuit against the Selective Consumption Tax (ISC) on casinos and slot machines to be partially founded, although he also recognized the constitutionality of the rule in question.
In the hearing of the Constitutional Court, whose members debated the case files from their homes via the Internet live, the lawsuit was dismissed for not obtaining the five votes required by law.
The claim was put forward in order to try and nullify the legislative decree that imposes the tax on casino games and slot machines.
In 2019 The Ministry of Economy and Finance (MEF) published new rules covering new taxes on the gaming industry. The new measures apply the tax on casino games and slot machines and went into effect on January 1st. The tax has until now been imposed on the sale and import of certain goods such as fuels, cigarettes, beer, liquor, and soft drinks. The government has already admitted that new taxes on gaming establishments could lead to closures.
The Peruvian Association of Entertainment and Gaming (APEJA) said that it had planned to fight the imposition of the new tax in the courts as they argue it would damage Peru’s growing gaming sector and is illegal. Earlier this year Constante Traverso, President of APEJA told press that the new rate in effect raised taxes from 12 per cent to 17 per cent. Overall the industry has reacted to the new taxes by reducing the number of machines and there has been a general downturn in the market.
