Bill’s rapporteur keeps 18% tax rate for sports betting companies, includes online gambling

The proposal should be voted on this Wednesday (13) in the Chamber of Deputies, after a week of discussions between party leaders. Rapporteur Adolfo Viana also maintained the value of the initial grant for authorization to operate the sites at R$30 million (US$ 6m). The sites will be able to operate for 5 years in Brazil.

“We made a lot of progress in the text, but the majority of parliamentarians asked us to maintain the tax burden as the government sent it. I made a proposal to reduce it, but when we take on the responsibility of reporting a matter, we have to listen to the majority of deputies,” said Viana.

The money collected from GGR (Gross Gaming Revenue), the tax on revenue from betting companies, will be divided between Social Security, the Ministry of Sports and the Ministry of Tourism, with part of the percentage going to Embratur.

In a fully regulated market, the Treasury was forecasting values of R$6 billion (US$ 1.2bn) to R$12 billion (US$ 2.4bn) per year. But the Annual Budget Law (PLOA) project sent to Congress foresees a collection of just over R$1.6 billion (US$ 325m) in 2024.

Project will also regulate online casinos

The opinion will authorize the regulation of not only bookmakers, but also online casinos.

"Unlike Bill 442 (approved by the Chamber last year to legalize gambling in general), we are not talking about releasing new games, but collecting revenue from those that already exist. There is not a city in the country where online casinos are not played," said Viana.

Taxation will be along the lines proposed by the Lula (PT) government for sports betting: 18% on the companies' gross revenue and 30% income tax on the winnings from each bet, without the possibility of deduction from other operations in which losses have occurred.

Sharing the proceeds

The money collected from GGR (Gross Gaming Revenue), the tax on revenue from betting companies, will be divided as follows:

• 2% for Social Security;
• 1.82% for the Ministry of Education;
• 6.63% for the sports area, with 4% for the Ministry of Sports and the remainder for sports confederations, with the exception of the CBF;
• 5% for the tourism area, 4% for the Ministry of Tourism and 1% for Embratur;
• 2.55% to the National Public Security Fund.

The original 2018 law that regulated fixed-odd betting provided for the distribution of 3% to the Ministry of Sports and did not provide for a transfer to Tourism.

In a fully regulated market, the Treasury was forecasting values of R$6 billion (US$ 1.2bn) to R$12 billion (US$ 2.4bn) per year. But the Annual Budget Law (PLOA) project sent to Congress foresees a revenue of just over R$1.6 billion (US$ 323m) in 2024.

Companies in national territory

The project also provides that betting companies will necessarily have to be registered in Brazil.

“Only legal entities established in accordance with Brazilian legislation, with headquarters and administration in the national territory, that meet the requirements contained in the regulations published by the Ministry of Finance will be eligible for authorization to operate fixed-odd betting,” says the text.

The bill also describes the people who will be prohibited from betting:

• Under eighteen years of age;
• Owner, administrator, director, person with significant influence, manager or employees of the operating agent;
• Public agent with duties directly related to the regulation, control and supervision of activity at the federative level within whose staff he exercises his powers;
• Person who has or may have access to computerized fixed-odd betting lottery systems;
• Person who has or may have any influence on the outcome of a real sports-themed event subject to the fixed-odd betting lottery, including coaches, athletes and referees.

Advertising

The bill also provides rules for advertising “bets”, companies will have to modulate how and to whom they target.

“Like we did back there, on the issue of cigarettes, demonstrating the problems that gamble can cause. This is a regulation that will come from the government, but we will already specify in law that there will need to be a message,” he said.

Earlier, the special advisor to the Ministry of Finance, and future secretary of betting and prizes, José Francisco Manssur, participated in a public hearing in the Chamber of Deputies. He also said that the Ministry of Finance is studying an ordinance with Conar (National Council for Advertising Self-Regulation) to regulate advertising on radio and TV.

“We are discussing an ordinance on responsible gaming with Conar. You turn on the TV today and are bombarded with “bet” advertisements. There is no time or message filter. We want to convey to Brazilian society that gambling is not a way to get rich, it is leisure. Being able to place advertisements within certain limits. Put a warning: bet responsibly, as is the case today in beer advertisements,” he said.

During the hearing, Manssur assured that the government and the rapporteur had reached a lower tax rate, which would please the bookmakers, without removing them from the regulated market. Furthermore, he reinforced that only sports betting would be allowed and not online gambling. Hours later, the reality proved to be very different from the scenario presented by the Ministry of Finance advisor.

Apostas esportivas: relatório mantém taxa para Bets em 18%; texto inclui outros jogos on-line by GAMES MAGAZINE BRASIL on Scribd

Source: GMB