Brazil’s lower house of congress Wednesday approved legislation to regulate online sports betting and casinos, a plan the government estimates will generate 2 billion reais ($407 million) in revenues in 2024 as it seeks to balance the country’s budget.
(Bloomberg) — Brazil’s lower house of congress Wednesday approved legislation to regulate online sports betting and casinos, a plan the government estimates will generate 2 billion reais ($407 million) in revenues in 2024 as it seeks to balance the country’s budget.
In a symbolic vote lawmakers passed the proposal, which states that betting sites will be taxed at an 18% rate on gaming revenues after payouts to winning gamblers are discounted. Bettors will receive an income tax exemption on prizes of up to 2,112 reais. Winnings above that threshold will be subject to a 30% tax rate.
Brazil’s congress initially legalized online sports betting in 2018, but a regulatory framework for the practice was never enacted. Finance Minister Fernando Haddad has made regulating and taxing gambling a priority as part of his larger effort to generate new revenues to eliminate the country’s primary budget deficit next year.
The bill, which still needs Senate approval, will generate only a small amount of the 168 billion reais Haddad needs to achieve his balanced budget goal in 2024, although he and President Luiz Inacio Lula da Silva are currently seeking to advance other revenue raising measures in congress.
Read More: Lula Seeks to Tax the Rich to Help Balance Brazil’s Budget
The government estimates that the regulation of Brazil’s growing online gaming market could eventually bring in between 6 billion and 12 billion reais in revenues going forward. The money is slated to be distributed to various government programs linked to security, tourism, sports and education.
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