Brazil, however, is following the path of also taxing bettors' earnings. Article 31 of Law 14,790/23 provides for a rate of 15%. Given this option, the question of the moment arises: what is the best model of taxation for bettors considering the importance of guaranteeing, the incentive to formalize the market, tax equality, and a competitive environment between formal market operators?
Part of this response was already in the first three paragraphs of article 31, but they were vetoed by the President of the Republic, creating insecurity in the market until the issue is regulated (or the vetoes are overturned).
The results of the simulations in the study by LCA Consultoria Econômica show that the optimal design to guarantee the three desired characteristics (and listed above) must prioritize taxation on the bettors' net gain (bets won minus bets lost), computed over the longest period possible and aggregating the results per bettor on the different platforms on which they play.
It is also desirable to have an exemption range that ensures that bettors with smaller amounts and who, therefore, will not generate significant revenue, are not encouraged to leave the formal market due to the simple transaction costs associated with complying with tax obligations.
Source: GMB
