Bolsonaro approves GGR tax modification for Brazil’s inbound sports betting regime

Brazilian President Jair Bolsonaro has signed into law a federal decree that regulates tax regimes for a number of industries, including Brazil’s yet to be launched sports betting regime.  

Signed as Law No. 14,183, the order was included in the Official Gazette of Thursday 15 July. The decree’s mandate stems from the ‘Provisional Measure 1,034/2021’ previously approved by the Plenary of the Chamber of Deputies of Brazil.

Amongst its numerous amendments, the approved law modified 30 of the proposed laws which have been agreed upon to govern sports betting. 

These include the restructuring of Brazil tax regime for sports betting, which will be based on GGR %, instead of a gross wagering value applied to customer bets, as was originally proposed.

According to the information provided by BNL Data, Brazil’s government will further impose a tax charge on player winnings, which must be declared by the individual at a rate of 30% income tax. 0.10% for physical bets and 0.05% for online bets will be subtracted.

Beneficiaries of the tax regime were disclosed as 0.82% of tax income being allocated to school organisations, whilst 2.55% will go to the National Public Security Force (FNSP) and 1.63% to the “Brazilian sports entities that grant their rights to use their names, brands, emblems, anthems, symbols and more to promote and execute fixed odd bets”.

Moreover, 95% of the proceeds will cover the costs and expenses of the state entity that will be charged with monitoring Brazil’s regulated gaming and betting sector.

The new regulation also establishes that companies that operate any type of lotteries and pay prizes in cash or real estate assets will be subject to further financial controls.

These controls will be carried out by banks and other financial institutions, which will be forced to submit reports to the Financial Intelligence Unit (FIU) of the Banco Central.

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