SPORTS BETTING
Brazil – Allocation percentages approved in Brazil for distribution of sports betting tax
By Phil - 7 June 2021
The Plenary of the Chamber of Deputies of Brazil, the country’s lower chamber floor, has approved Provisional Measures for tax levels for sports betting with the bill now being sent to the Senate to be signed off.
The amendment has seen taxation moving from turnover to a Gross Gaming Revenue model. They also outline the percentages that state institutions will be given from the sports betting funds. In September 2019, initial press reports suggested Brazil’s Ministry of Economy would set a one per cent turnover tax on sports betting. In December 2019, it was revealed that Brazil’s sports betting tax rate would remain at three per cent of turnover instead of one per cent after moves to change the headline rate failed to gain approval in Congress. The gross gambling revenue (GGR) taxation model is now generally accepted as the most beneficial approach to taxation for online gambling across most jurisdictions in Europe for both operators and governments alike.
The new figures will see 95 per cent of the tax covering the costs and expenses of the social security, health and education.
In total, 0.82 per cent will go into education, 2.55 per cent will go to the National Public Security Force (FNSP) whilst 1.63 per cent will be given to ‘Brazilian sports entities that grant their rights to use their names, brands, emblems, anthems, symbols and more to promote and execute fixed odd bets.’
Deputy Moses Rodrigues said: “Experience in Europe shows that it is better to adopt the operator’s gross profit as a basis, providing stable flows of public revenue and prizes and making bettors use the services of local operators. The goal is to improve sports legislation by changing the tax base to GGR. The amendments to the aforementioned legislation will allow progress towards the establishment of the lottery modality of fixed-odd betting and to have the appropriate collection for the Union.”
