The Ministry of Finance is articulating a change in approach to the sports betting regulation in Brazil. The intention is to put the provisional measure aside and create a Bill to debate the matter in Congress, a posture that has generated apprehension in the sector.
Law 13,756/18, approved during the term of Michel Temer, released the market for operations in the country, but its regulation has not yet been completed. The government of Luiz Inácio Lula da Silva must review the taxation system provided for both operators and players based on new legislation.
“This creates more uncertainty and quite a lot of frustration. The signs that we have been hearing are worrying. The government is wanting to change the taxation part, which is something that shouldn’t be being changed. We, as an operator, understand that the taxation approved in the 2018 project is very well placed”, said André Gelfi, CEO of Betsson in Brazil and CEO of the Brazilian Institute of Responsible Gaming (IBJR).
The government plans to increase the taxation provided for by the 2018 legislation by 11%, with 1% allocated to the Ministry of Sport and 10% to Social Security. According to a study by consultancy H2 Gambling Capital, the sector in Brazil should move BRL 84 billion in 2023.
The billing estimate for companies in the segment is R$ 5.8 billion this year, five times more than what was collected in 2019. Projections indicate that, with each day of delay for the regulation of betting, the country stops raise R$ 4 million.
“We are seeing this discussion being reconsidered, changing its format, in the face of a very worrying situation, which has been pervading the segment as an involved party. The regulation of sports betting does not solve this issue of match fixing, but it provides efficient tools to deal with the issue”, declared Gelfi.
“When you have the betting segment working in an articulated and preventive way, with monitoring control mechanisms and established punishments, this mitigates the possibility of this type of thing happening”, he added.
Government wants to separate regulation of sports betting from online casinos
According to a report by Veja, other options suggested by the Federal Government are the 30% taxation of the player who receives more than R$ 2,000 per bet and defer the sports betting regulation in online casinos.
“Since several of these sites are registered outside Brazil and the casino part has revenue equal to or greater than the bets, you will encourage the gambler to play in the parallel market and the operators to continue operating abroad. The government needs to prohibit Brazilians from reaching an international gaming site in the parallel market”, concluded André Gelfi.