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Taxes and revenues El Salvador

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Brief summary

The fiscal revenues of the state from gambling in El Salvador consist of four main channels:

1. Transfers and payments from the National Charity Lottery (LNB), the market's largest player;

2. Withholding income tax on winnings - standard rate of 15% according to the Tax Code;

3. Indirect revenues related to the import of gaming equipment (duties, VAT on imports);

4. Administrative payments/fees (licenses, fines, etc.) within the framework of LNB competencies and relevant legislation. For 2024-2025 published reports record a sharp increase in LNB revenues - up to ~ $61.3 million, which makes it a key source of measurable sector revenues.

Regulatory framework: who collects and controls

The LNB acts as an autonomous public organization: the law directly enshrines its status and the functions of the operator and regulator of games. This explains why a significant part of the money passes through the LNB and is displayed in its plans/reports (including transfer items).

Tax part: deduction of 15% of income tax on winnings (ISR) is provided for by the Tax Code and is confirmed by the explanations of the Ministry of Finance: a resident wins a prize - the organizer holds 15% when paid.

Import of equipment (slots, spare parts, etc.) - source of duties (DAI) and import VAT; this is not a "gambling tax," but direct budget revenues due to industry activities.

Online products and rates: In recent years, new rules and licensing regime in the LNB perimeter have been discussed; details of rates/fees were published in fragments, some of the sources were consulting notes and draft norms. They are correctly interpreted as the evolution of regulatory practice, and not as final rates.

What is already visible in numbers (reference data)

LNB earnings: According to business publication Diario El Mundo (26. 08. 2025), LNB revenues rose from $18.8 million to $61.3 million. This is a fresh, publicly quoted point showing the scale of the institution and, indirectly, the potential for budget transfers.

LNB budget and transfers: in the official "Memoria de labores 2023-2024" and projections for 2024/25, a significant article "Transferencias corrientes" (~ $49.9 million) is visible - an indicator reflecting social and related payments that form the state effect of the lottery.

Winnings tax (15%): Applies to prize payouts, withheld by the source on payout, simplifying administration.

💡 Conclusion: it is LNB that provides the greatest transparency and regularity of flows (both own income and transfers), while for private casinos/data bets it is much less.

How the fiscal "pie" develops

1. LNB → the state and society

Part of the income is sent in the form of transfers and social support programs (recorded in the LNB plans/reports). This is a key channel for visible income.

2. Tax on winnings (15%)

Direct budget receipts due to deductions when paying lottery prizes/contests/games.

3. Import duties and VAT on imports

Budget revenues for the delivery of slot machines, components, POS equipment, etc. (DAI + IVA por importación).

4. License/administration fees and penalties

Permit fees, possible fines for violations, etc. (via LNB and applicable regulations).

Accurate estimate of annual receipts (2024-2025)

There is no official consolidated figure "taxes from gambling" in the public domain. We offer a cautious assessment based on public data and market structure:

Transfers/payments displayed at LNB: the target value of transfers ~ $50 million (order of magnitude) serves as a guideline. In reality, execution changes by year, but the scale is clear.
15% deduction from winnings: depends on prize pool; for the lottery, the share of prizes is traditionally significant. Without detailed statements on the amount of prizes paid, we will give a qualitative assessment: this is a significant, but smaller channel compared to LNB transfers.
Duties/VAT on equipment imports + fees/penalties: the contribution is moderate and volatile, depending on the investment cycles of the casino and fleet renewal.

The final hypothesis: total fiscal revenues due to the gambling sector (LNB transfers + tax on winnings + import/admin payments) in 2024-2025. may be in the range of tens of millions of dollars, with the lion's share being transfers/payments through the LNB. The exact value requires the annual consolidated reporting of the Ministry of Finance/LNB (at the time of preparation of the article is not publicly aggregated).

Factors influencing the dynamics of revenues until 2030

The growth of LNB digital products (electronic circulations, online services) is an expansion of the player base and the frequency of ticket/participation purchases.

Payment infrastructure: after the 2025 reforms, the use of Bitcoin is voluntary, not mandatory - this reduces regulatory uncertainty for payment scenarios and administration.

Regulatory certainty for online gaming/betting: Formalizing license/reporting requirements will increase collection and predictability for the budget.

Investment cycles (updating slots/zalov) → volatile but tangible import payments.

Risks and limitations

Lack of open statistics on non-lottery segments (private casinos/bets rarely publish GGR and tax details).

Dependence on LNB: Concentration of receipts in one institute makes the flow vulnerable to operational/legal shocks.

Payment volatility and regulatory changes (crypto payments, KYC/AML).

What to monitor (checklist for updating numbers)

1. LNB annual/quarterly reports (income, transfers, prize funds).

2. Publications of the Ministry of Finance on the use of ISR deductions with winnings (15%) and their amounts in dynamics.

3. Import statistics on TN VED for slot machines/parts - to assess duties and VAT on imports.

4. Regulatory updates on online games/betting (licenses, fees, penalties).

To date, the main and most transparent source of budgetary effect from gambling in El Salvador is LNB (high incomes and significant transfers), supplemented by a 15% tax deduction on winnings, as well as import duties/VAT and administrative payments. A systematic increase in electronic products and clear regulation of the online segment can increase the share of predictable revenues by 2030 - provided that transparent reporting and stable rules are maintained.

💡 Note: estimates of "target bets" for future casinos found in consulting publications are unofficial interpretations of draft regulations; for references in analytics and planning, it is recommended to rely on the texts of laws/by-laws and official reports of the LNB/Ministry of Finance.