The Chamber of Deputies approved this Wednesday (13) the bill that regulates sports betting in Brazil, as well as other online gambling, such as virtual casinos. The proposal will tax company revenues, winners' prizes and institute an initial grant to authorize websites to operate legally. The project was approved by symbolic vote and goes to the Senate for analysis.
The tax charged on revenue from sites will be 18%. The value of the initial grant for authorization to operate the sites will be R$30 million (US$ 6m). The sites will be able to operate for 3 years in Brazil. Prizes for individuals will be taxed at 30%, including the initial investment, in addition to winnings. This model is already adopted today in the federal lottery.
The text changed the distribution of the amount collected between government areas, reducing the percentage allocated to Social Security (falls from 10% to 2%) and, at the same time, increasing the portion sent to the Ministry of Sports (3% to 4% ). It also plans to include the Ministry of Tourism, which is currently not covered by these resources.
After attempts to postpone the vote on the report by Adolfo Viana (PSDB-BA), the Chamber of Deputies approved this Wednesday (13) night the replacement for Bill 3,626/2023, which regulates sports betting in Brazil. The project was approved by symbolic vote and goes to the Senate for analysis.
The expectation of reducing the tax burden initially defined at 18% on the GGR ended up not happening, however, rapporteur Adolfo Viana included authorization for the operation of online gambling on sites that qualify with the Ministry of Finance.
The bill report changed the distribution of the funds, reducing the amount for social security, and covering two ministries that were recently used to seduce the Centrão bloc: Sports and Tourism.
The Provisional Measure (PM) sent by the government in the first half of the year predicted that the social item would be entitled to 10% of lottery proceeds, after discounts. The report by deputy Adolfo Viana (PSDB-BA), published this Tuesday (12), predicts that this amount will rise to 2%.
Previously, Sport was entitled to receive 3% of the revenue from bets, a value that increases to 4% under the project. Tourism, which did not even appear in the PM, was awarded 4%, with an additional 1% for Embratur.
Recently, President Luiz Inácio Lula a Silva (PT) fired former athlete Ana Moser from the Ministry of Sports to consider federal deputy André Fufuca (PP-MA), an ally of the president of the Chamber, Arthur Lira (PP-AL), as part of the mini-electoral reform to give more space to the Centrão within the Executive.
Favorable opinions
The substitute had a favorable opinion from the Finance and Taxation Committee (CFT) and the Constitution and Justice Committee (CCJ) of the Chamber of Deputies, enabling the rapporteur to present his substitute in the Plenary.
The CFT concluded that “we voted for the non-budgetary and financial implications of Bill No. 3,626, of 2023 and the attached Substitute, and it is not up to this Committee to say whether the proposals are appropriate or not; and, on merit, for its approval, in the form of the attached Substitute.”
Within the scope of the CCJ, “we voted for the constitutionality, legality and legislative technique of Bill No. 3,626, of 2023, and the CFT Substitute and, on merit, for its approval, in the form of the Substitute presented by that Commission.”
Sharing the proceeds
The money collected from GGR (Gross Gaming Revenue), the tax on revenue from betting companies, will be divided as follows:
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:
Source: GMB
