President Luiz Inácio Lula da Silva sanctioned the law that regulates sports betting with vetoes. The measure was published in an extra edition of the Official Gazette of the Union on Saturday, 30.
Lula vetoed sections that would reduce tax revenue from betting. The head of the Executive barred Income Tax exemption for bettors who have annual earnings below the first income tax bracket – currently R$2,112.
As a result, the 15% rate stipulated for winnings from sports betting will apply to any amount obtained by the bettor. The president also vetoed the section that discounted the bettor’s losses when calculating the amount on which the tax would be levied.
New law sanctioned
According to the veto message, maintaining the text approved by Congress “would result in income tax taxation being different from that seen in other lottery modalities, thus creating a distinction of tax conduct without a motivating reason for this”.
The new law sanctioned is part of the effort by the Minister of Finance, Fernando Haddad, to increase revenue. The measure establishes general rules for the operation of bets. The company that wants to provide the service will need to pay for a grant of up to R$30 million issued by the Ministry of Finance. There will be a 12% tax rate on companies’ revenue, minus premiums paid.
Furthermore, the text stipulates what will be done with the money raised. Unclaimed prizes, for example, will be allocated to the Student Financing Fund (Fies) and the National Fund for Public Calamities, Protection and Civil Defense.
