Talks about the legalization of gambling in Brazil continue. While the country continues to shape its tax reform, the taxation of gambling may bring a nice boost for the government coffers. Besides boosting tax revenue, the legalization of gambling may increase tourism volumes and create new workplaces.
Gambling Legalization in Brazil to Help with Taxes, Workplaces and Tourism
It was back in the 1930s when Brazil created more than 70 casinos around the country. Permitted back then, gambling saw quite a few strong years from 1934 through 1946. However, in 1946, a ban on gambling and casinos was introduced by President Eurico Gaspar Dutra. This effectively closed all gambling venues in the country.
Now it seems that the ban that has been in place for more than five decades may be coming to an end. This may happen in light of the ongoing tax reform in Brazil, which may also result in the legalization of gambling activities.
Senator Irajá Silvestre Filho, who proposed a bill that calls for the creation of integrated resorts (IR), revealed in August that the activity may generate billions in taxes. He predicted that approximately $3.42 billion (BRL18 billion) in taxes may be generated by IRs. Additionally, according to Filho, those resorts may attract $8.36 billion (BRL44 billion) in investments.
With that in mind, taxation alone is not the only argument why Brazil is looking at legalizing gambling. If the activity is legalized, hundreds of thousands of workplaces would be created. Such a change will undoubtedly result in growth in terms of tourism.
Tax Revenue May Be Significantly Higher, Says Senator
According to Senator Angelo Coronel, who recently spoke to Bloomberg, if the tax reform includes the legalization of gambling, tax proceedings may hit $9.5 billion (BRL50 billion) annually. Coronel supports a bill that proposes the legalization of gambling, but he is also a rapporteur in the Senate.
He revealed that if tax reform doesn’t reduce taxes, it isn’t reform. According to Coronel, if the tax reform leads to a loss of tax revenue, an alternative such as gambling legalization may be a suitable option to fill the gap.
Although the bill proposing gambling legalization has passed a vote by the lower house, now the Senate must also vote. Before voting, the Senate will conduct several public hearings, but Coronel hopes that they will be able to vote by November.