The Ministry of Finance sent a notification to Loterj (Rio de Janeiro State Lottery) requesting the interruption of the accreditation of online bookmakers, known as “bets“, in the current format.
The ministry argues that the state government, through Loterj, is accrediting bets without imposing restrictions so that these companies operate exclusively in the territory of Rio de Janeiro.
Bets are accredited in Rio but operate throughout Brazil
But according to the Ministry of Finance, in practice, bets are accredited in Rio de Janeiro, but operate throughout the national territory, which contradicts federal legislation.
In 2020, the Federal Supreme Court (STF) authorized states and municipalities to explore games, as long as they respect the limits of their territories.
Thus, Rio de Janeiro’s maneuver in relation to legislation worries the economic team, which fears a fiscal war in the country around the accreditation of betting houses.
Another concern is the drop in revenue. In Rio de Janeiro, each company must pay a grant of R$5 million, an amount lower than the R$30 million established by the federal government.
In this way, the sector’s taxes are collected by the state government, not by the Union. Therefore, the rate predicted by Loterj is 5% of companies’ gross revenue, in contrast to the 18% to be charged by the Federal Revenue.
The Treasury would have negotiated changes with Loterj to close this loophole, but it appears that there was no agreement. Therefore, the decision to formally notify was taken.
Lottopar demonstrates with the Ministry of Finance
To date, more than 130 companies have expressed interest in operating in Brazil. The federal government’s expectation is to raise up to R$10 billion per year from the betting market, including virtual casinos.
Sources at the Ministry of Finance state that, if Loterj does not comply with the requests from the Sports Betting Secretariat, the Union will appeal to the STF. Thus, to date, Loterj has four accredited bets and another three in the qualification process.
The 30-day period for more companies to request accreditation ends on April 4th.
But the Paraná State Lottery (Lottopar) also spoke out against Loterj’s stance and went to court. Lottopar joined a public civil action that questions the criteria adopted by the company from Rio de Janeiro for accrediting bets.
In a public statement, Lottopar declared that its objective is to preserve the betting market in the country. While Loterj stated that it maintains dialogue with the Ministry of Finance and all spheres of the public and private sector.
