Brazil: Lula’s government will tax sports betting sites’ profits at 15%

The government of President Luiz Inácio Lula da Silva will tax companies and citizens who operate in the sports betting market in Brazil.

The taxation of the sites with the largest presence in the country is part of a provisional measure drawn up by the Minister of Finance, Fernando Haddad.

Under the rule, bettors will be taxed at 30% on the value of the prizes they receive.

There will also be an exemption for winnings within the first income tax-free band of R$2,000 (about US$400) monthly.

The Finance Ministry’s special advisor, José Francisco Manssur, announced the measure last week during a public hearing in the House of Representatives.

The new rules should be published later this month.

The companies will have to pay R$30 million (US$6 million) to the federal government for a five-year license and a 15% tax on profits – revenue obtained after the distribution of premiums.

Other requirements to operate in Brazil are having Brazilian employees and capital stock of at least R$100,000 (US$20,000).

The companies that sell the bets and those that offer the means of payment must also be accredited by the government.

SPORTS BETTING WITHOUT REGULATION

Betting in Brazil was legalized in 2018.

The government cannot tax the amounts moved because they have not yet been regulated.

According to the folder, taxation is one of the strategies to increase federal government revenues by up to R$150 billion.

The money would be used to support the goals of the fiscal framework presented by Fernando Haddad.

The Ministry of Finance intends to raise about R$15 billion annually by taxing betting.

More: Brazil news in English, every day from The Rio Times.