Brazil’s Parliament Passes Sports Betting and Online Gambling Bill

Brazil’s lower house of Parliament approved a bill on September 13 aimed at regulating sports betting and online gambling. The bill, which also encompasses virtual casinos, is now headed to the Senate for further deliberation.

Brazilian Legislation Sets 18% Tax on Online Betting Revenue

The bill proposes an 18% tax on the net revenue generated by online betting companies, marking a significant step in formalizing and regulating the burgeoning online gambling industry in Brazil. Companies wishing to operate legally in the country will need to obtain a grant, which has been set at BRL30 million ($6 million), valid for a three-year period.

The legislation not only seeks to regulate the industry but also aims to allocate the generated tax revenue strategically. The funds will be distributed among various government departments, including the ministries of tourism, sports, and education, as well as the National Public Security Fund, and Social Security. Additionally, sports organizations and confederations are also set to benefit from the tax revenue.

The bill’s passage has garnered support from government officials, with Jose Guimaraes, the leader of the lower house, hailing it as a crucial step toward curbing tax evasion in the country in a post on X (formerly Twitter). He noted that the legislation would bolster the government’s finances, providing more resources to fund national reconstruction projects.

Sports Betting Bill Overhauls Tax Allocation in Brazil, Opens Doors for Online Gambling

One notable change in the bill’s distribution of funds is the reduction of funds allocated to social security, from 10% to 2%. Simultaneously, the Ministry of Sports will see its share increase from 3% to 4%. The Ministry of Tourism, which previously had no allocation, will now receive 4%, with an additional 1% earmarked for Embratur.

Despite some attempts to postpone the vote, the bill was approved by a symbolic vote and will now be evaluated by the Senate. Adolfo Viana, the rapporteur of the bill, emphasized that the legislation also allows for the operation of online gambling on sites that meet the Ministry of Finance’s qualifications, expanding the scope of the regulated industry.

The bill aims to ensure that betting companies operating in Brazil are registered within the country and adhere to Brazilian legislation. It also prohibits individuals under the age of eighteen from participating in gambling activities. Additionally, those directly involved in sports events, such as coaches, athletes, and referees, are prohibited from participating in fixed-odd betting.