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Priorities for regulating sports betting are mentioned in a Senate hearing

Prioridades para regulamentação das apostas esportivas são citadas em audiência pública no Senado

Foto: Jefferson Rudy/Agência Senado

In a public hearing this Thursday, 19th, at the Senate’s Economic Affairs Committee (CAE), debaters discussed the main points that need to be addressed in the regulation of fixed-odd sports betting, known as bets.

The project (PL 3626/2023) is at the Sports Commission (CEsp), where it was the subject of a review request, and will then go to the CAE. The project came from the Chamber of Deputies and deals with rules for authorization to operate this type of bet.

It also stipulates the percentage of federal revenue from betting taxation that will be allocated to various areas, such as social security, sport and tourism.

The topic has aroused criticism from parliamentarians who point to the social risks of gambling and the use of the activity for money laundering.

Fixed odds betting has been legal since 2018.

Finance representative cites importance of regulating sports betting

José Francisco Manssur, special advisor to the Ministry of Finance, explained the most important points of the regulation proposal, which was sent by the federal government.

According to him, the most immediate need is to correct the gap that allows these services to operate without paying taxes, which is a “serious tax distortion”.

“The segment has operated in Brazil from 2018 until today without paying taxes. Nothing is more unfair than essential services, [such as] those who produce food and clothing, and workers collecting their taxes, and this segment collecting nothing. People are gambling: out of ten Brazilians with access to a cell phone, seven have already placed a bet.”

Manssur asked parliamentarians to approve the project because, according to him, only with legislation in force will it be possible to address the problems that betting critics denounce.

He spoke of the ministry’s concern with negative externalities such as money laundering loopholes and the match-fixing industry, and highlighted cases of ludopathy — addiction to gambling.

José Francisco Manssur, special advisor to the Ministry of Finance. Photo: Agência Brasil / Archive

“The operator has to inform us of the time the person spends in front of their cell phone playing, the maximum loss limit, the pause period.”

“We have to exclude people who show signs of addiction. All of this can only be achieved with regulation. The wild environment that exists today leaves us unable to act”, he added.

Responsible gaming policy

Senator Eduardo Girão (Novo-CE), who presided over the hearing, said that the spread of virtual betting has generated a “human tragedy”, and drew attention to cases of people who find themselves in financial difficulties.

Manssur warned of the need for a “responsible gaming policy”. “Gaming is not a way to get rich. Most people lose money gambling. Don’t believe the advertisements”, he warned.

The lack of regulation also affects official lotteries. This was the argument of Bruno Pires Lobato, president of the National Lottery Association (ALSPI). He denounced the “unfair competition” that benefits virtual betting houses.

“If we fail and don’t follow the rules, the next day our lottery machine is turned off. I don’t understand how these sites have been operating for five years without generating taxes, destroying our jobs and taking foreign currency abroad”, reinforced Lobato.

Ricardo Liáo, president of the Financial Activities Control Council (Coaf), praised several points of the law, in particular the rules that would be required of betting services to verify the validity of user identification.

“The “know your customer” policy is the main instrument for developing mechanisms and internal controls capable of evaluating financial behavior. It is from this movement that many issues related to crimes are revealed. It would be very important as an element of mitigating money laundering”, highlighted Lião.

The control of financial movements was also a point highlighted by Vilson Antonio Romero, president of the National Association of Tax Auditors of Federal Revenue of Brazil (Anfip).

Romero also drew attention to the allocation of taxation, criticizing the smaller share reserved for social security — 2% of revenue, compared to 5% for tourism and more than 6% for sport.

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