The government’s economic team is analyzing the proposal to tax games with the selective tax, which is being known in Brazil as the “sin tax”.
This tax has already been approved within the tax reform, but still needs regulation. In recent weeks, the National Congress has intensely debated the issue.
Even approved by the CCJ, the game project still causes discussion
“It’s a demand from some deputies and we are evaluating whether it makes sense or not. Again, it’s the same issue as in the case of cigarettes. Yes, you have to tax it, it’s bad for your health, everyone knows,” said Bernard Appy, extraordinary secretary of the Ministry of Finance for tax reform.
“But if you get it wrong, you encourage a lot of smuggling. So, the question is knowing how and if this taxation makes sense and calibrating it appropriately. We are doing it together with the Betting Secretariat at the Ministry [of Finance ]”, he added.
Appy emphasized that, to date, there is no definitive position from the Ministry of Finance. “But, at the request of parliamentarians, we are making this assessment [of taxing the sin tax].”
What is the ‘sin tax’?
The constitutional amendment approved at the end of 2023 establishes that this tax will be applied to:
- Production
- Extraction
- Commercialization
- Import of goods or services that are harmful to health or the environment
Then, in the regulation phase, details will be defined such as which products or services will be subject to tax and the respective rates.
So far, the government and states have suggested levying the tax on:
- Cigarettes
- Alcoholic beverages
- Sugary drinks
- Automobiles
- Petroleum
The World Health Organization (WHO) reported in 2016 that gamblers lose an estimated US$400 billion annually. This information led to the games being included in this list.
Recently, the Constitution and Justice Commission (CCJ) of the Federal Senate approved a bill that legalizes gaming in Brazil, including bingo, Jogo do Bicho and casinos.
The Chamber of Deputies approved the topic in 2022, but the Senate Plenary still needs to debate and approve it. If there are no changes, the project will go to presidential approval after approval.
Lula says he will sanction PL that allows games in Brazil
According to the PL, only people over 18 years of age will be able to participate in the games. But bettors diagnosed with gambling compulsion or legally banned by their family will not be able to place bets.
Last Friday (21), President Lula stated that he will sanction the project if it is approved by the National Congress.
“If Congress approves and an agreement has been reached between the political parties, there is no reason not to sanction it,” said Lula.
