The Federal Government intends to raise between R$ 12 billion and R$ 15 billion with a new taxation system for bookmakers in Brazil. Although it has not yet been properly presented, this model tends to focus on taxing companies’ profits and players’ income according to hits.
According to an opinion article published in the Diário do Nordeste, the action can consolidate a new understanding of the betting industry in the country, currently formed by players that have their headquarters outside Brazil.
With the intention of having control over the bookmaker sector, the government must demand the registration and installation of a headquarters of the companies in the national territory. The regulation is being prepared via provisional measure (MP) and some details were presented by Samuel Quintela in the following article. Check it out!
New taxation on bookmakers may reduce earnings for bettors in Brazil; understand
The Federal Government aims to raise between R$ 12 billion and R$ 15 billion with a new taxation model for betting shops in Brazil. Despite being uncertain, the model should focus on taxing companies’ profits and players’ income from hits, according to specialists consulted by the column.
According to the lawyer and master in international business, Vanilo de Carvalho, the initiative could give a new understanding of the betting market in Brazil, which has most operations controlled by companies based outside the country. This model frees companies and players from taxation in Brazil, creating a gray and nebulous legal environment because there is no clear regulation.
“It’s not a tax on electricity, water, or items of essential use. Whoever wants to play games of chance, so he should also be aware that he will incur taxes. Both in terms of profits, for the company and to the person”, defended Vanilo.
CREATING A HEADQUARTERS IN BRAZIL
To try to generate more control in the sector, the Brazilian Government should require the registration or installation of a headquarters for bookmakers in Brazil, according to lawyer Rafael Mota Reis.
“What is happening is the possibility of taxing activities that are not taxed. The monopoly was Caixa Econômica Federal, but sports betting was released and they worked without specific taxation. How does taxation happen for companies with tax registration in the Brazil, and this is done through the CNPJ, yes, what we have is the need to have a headquarters or registration here in Brazil, even if the company is headquartered outside the country”, he said.
“What is expected is that the company that wants to operate should at least register, with a national registry”, he added.
COLLECTION MODEL
Reis also commented that the expectation of specialists in the sector is that the taxation of bookmakers will follow the model of official lotteries, managed by Caixa Econômica Federal, such as Mega-Sena. With the application of taxation on profits, the gains of bettors can be reduced, pointed out the lawyer.
“Taxation, as a rule, is always on profits. In betting, taxation is on the general amount, following the model that already exists for Caixa lotteries, such as Mega Sena, Quina. Which leads us to believe let it be in the same way. A part that would go to the winner of the bet can be reduced by the tax, reducing the possibility of profit”, he said.
“Today, in practice, they already work with a statistical basis of results. You bet on a scoreboard and the statistical margin is what will determine the profit margin, so we cannot say how much this taxation can impact the collection, not least because there are no defined rates of this taxation either”, “quoted the lawyer, Rafael Mota Kings.
INCOME TAX DECLARATION
Although they are not taxed in Brazil, it does not mean that gambling winnings do not need to be declared in the Income Tax. The column already talked about the subject in early January. But it is also important to note that the bettors’ profits already represent the net value.
That is, winnings are already taxed following the collection model of the host country of bookmakers. With the requirement of registering in Brazil, organizations will have to adapt to the new model, which is still being set up by the Federal Government.
“The gambler’s gain is already taxed. And any income gain, including gambling, has to be declared in the Income Tax. The difference is that in official lotteries, this is already withheld at source. But it is already taxable by law. So gamblers should make the declaration of winnings in the Income Tax”, explained Reis.
