The debate on "Regulation of Sports Betting in Brazil" this Thursday (19), in Brasília, was productive and brought the industry's position to politicians and members of the Executive. Tendências Consultoria presented a study commissioned by IBJR on the economic impact of market regulation. The special secretary of the Ministry of Finance, José Francisco Manssur, stated that the government is willing to reconsider the tax, concession period, and tax on the bettor, but it depends on Parliament.
The conclusions of the study prepared by Tendências Consultoria, in line with the Brazilian Institute for Responsible Gaming, were at the center of the discussions at the meeting organized by IBJR, the Brazilian Institute of Capital Markets (IBMEC), and the law firm Pinheiro Neto Advogados.
High tax burden and the concession model of the bill approved in the Chamber of Deputies were the challenges presented to the participants of the meeting and served to highlight the problems faced in countries like Portugal, France, and Norway, where the parallel market for gaming and betting remains significant due to high taxation.
In the Tendências study, these three countries are pointed out as having the lowest channeling rates, unlike the United Kingdom, also mentioned in the document as the best example to follow, with a channeling rate of 95%, a result of a 15% GGR tax rate.
In the presentation, a total tax rate of nearly 30% is mentioned, contrary to what is discussed regarding the definition of an 18% GGR tax rate.
According to Andre Gelfi, President of IBJR, the presentation was very well received by the audience, which consisted of nearly 50 people, including journalists, government officials, and parliamentary advisers, as well as the board of the Institute, Tendências, and Pinheiro Neto Advogados.
"It's important to say that betting companies, currently based abroad, want to replicate models and pay taxes, but it needs to be done sustainably. The question is how to do that. We have the opportunity to discuss adjustments and improvements in the Senate, which gives us the motivation to do the best we can," Gelfi stated.
Everyone seemed to be very receptive to the demands of the Brazilian gaming and sports betting sector in terms of working for changes in Bill 3626/2023, which is currently under review in the Senate.
José Francisco Manssur, the special secretary of the Ministry of Finance and in charge of regulating sports betting in the government, praised the content of the Tendências Consultoria study and the arguments put forth by industry leaders.
Manssur told those present that the government, through the Ministry of Finance, is open to discussing the demands, but changes to the bill regulating sports betting will be up to the Senate, where the bill is being expedited.
"We may have made mistakes, but we've always been open to dialogue. No one can say they were not heard at the Ministry of Finance when they requested a meeting with us. The entire process has been guided by open dialogue," Manssur affirmed.
The special secretary of Finance added: "Today, we are beginning a new stage of this dialogue, this time with Parliament. We have made an effort to engage in as much dialogue in Congress as possible. That was the case in the Chamber of Deputies, and now it's the Senate's turn."
Regarding the bill defining the concession value and period, Manssur stated: "We wanted to establish the concession value and validity period parameters in the Provisional Measure, which advanced in the Chamber of Deputies' Bill. Now, it's up to us to try to work on this in order to establish the limits set by Congress in the regulation to be issued."
"We understand that taxation is essential for all of us, not only the incidence on legal entities but also the allocations, which are inherent to lottery modalities. It's up to Congress to determine how this matter will be resolved," said Manssur, adding that if there are changes in the Senate, it will return to the Chamber of Deputies until it reaches the approval of the President.
Manssur mentioned that the government understands the issue of taxation on bettors and aims for a taxation system similar to the stock market, where taxes are levied on the final balance at the end of the month, rather than on each individual bet. He indicated that an ideal formula can be reached through regulation.
"As for us, because we intend to start receiving the first concessions from January 2024, our role is to present the regulations so that we can address accreditation issues and all internal regulations within the Ministry of Finance," explained Manssur.
The special secretary of Finance also commented on the government's concern about combating match-fixing related to sports betting, promoting responsible gaming, and addressing issues related to advertising in the sector.
The main absence at the meeting was Senator Angelo Coronel, the rapporteur of the bill in the Senate's Economic Affairs Committee, due to scheduling issues. However, he received the IBJR's study and is open to discussing the issues raised in the institute's document with the sports betting sector.
Source: GMB
