Technical Note 49/2023
Introduction
The text of Bill No. 3626-A/23, approved in the National Congress, meets the best international practices and has been recognized globally as an example of modern legislation for the creation of a new sector in the national economy.
However, the IBJR views with concern the veto of the first three paragraphs of Article 31 of the bill (devices 49.23.001; 49.23.002; and 49.23.003 of VET 49/2023), which deals with player taxation. This is because a change in the calculation basis of player taxation will result in a negative experience for the user, discouraging them from staying in the regulated market.
The natural consequence will be a drastic decrease in investments by sector companies and a consequent meager collection by the Federal Government, frustrating not only the expectations of the entire productive chain of the sector, including sponsored sports entities and media, but also of the consumer market, which will remain unprotected.
Below, we dissect the main problems generated from the veto.
Lack of definition for the concept of "net prize"
Device 49.23.001 of VET 49/2023 - § 1st of art. 31
For the purposes of this article, the net prize is considered the positive result obtained in fixed odds bets made each year, after deducting losses incurred with bets of the same nature.
The veto of § 1st of art. 31 has the consequence of the absence of a clear definition of "net prize," since the wording of the device is silent. This omission generates uncertainties regarding the taxation of prizes obtained in fixed odds bets.
Several questions arise from the lack of definition, such as the need to deduct losses and costs from the prizes received, the period for calculating the net prize, and whether the calculation should be done globally or individually for each betting platform.
Uncertainty regarding the application of the exemption
49.23.002 of VET 49/2023 - § 2nd of art. 31
The tax referred to in the "caput" of this article shall apply to net prizes that exceed the value of the first bracket of the annual progressive table of the IRPF.
The veto of § 2nd of art. 31 also falls into omission, this time regarding the application of the IRPF exemption bracket. This is because Law 14,790/23 does not clarify whether the exemption from Income Tax applies to net prizes that do not exceed the first bracket of the monthly incidence table of the tax.
However, the general rule of Article 56 of Law 11,941/09, which grants this exemption to prizes obtained in lotteries, is still in force. Since fixed odds bets are a lottery modality and Article 31 of Law 14,790/23 does not exclude the application of this exemption, it is necessary to clarify that the exemption also applies to these bets. The absence of this clarification may contribute to the legal uncertainty of the sector.
Lack of definition regarding the definitive or anticipatory nature of the IRPF
49.23.003 of VET 49/2023 - § 3rd of art. 31
The tax referred to in the "caput" of this article shall be calculated annually and paid by the last business day of the month following that of the calculation.
The veto of § 3rd of art. 31 generates another lack of definition. This refers to the definitive or anticipatory nature of the 15% Income Tax established by Article 31 of Law 14,790/23. There is no clarity as to whether this tax should be considered in the Annual Adjustment Statement (DAA) for purposes of refund or supplementary collection.
The absence of specification in the legal device generates uncertainty, since the legal system allows for both modalities of tax incidence. Furthermore, the taxation provided for in Article 14 of Law 4,506/64, applicable to lotteries, is exclusive at the source and definitive. Therefore, it is necessary to clarify that the source taxation of fixed odds bets will be exclusive and definitive, as provided for in Article 14 of Law 4,506/64."
Brazilian Institute of Responsible Gaming
