According to Finance Minister Fernando Haddad, the time has come for the country to roll out a fully-fleshed tax on sports gambling which will arrive very soon. The measure is expected to be revealed this month, but no confirmation has been made as to whether the tax itself will come into effect right away or include a grace period.
Sports Betting Businesses Need Brace Themselves
The political backing for this is understandably high as a tax on sports gambling would mean more money going to the state coffers. This measure makes economic sense as well because Brazil needs to find money to fill in for the exemption for workers who earn up to twice the minimum wage, which was promised under the new government of President Luiz Inacio Lula da Silva, who ousted his rowdy predecessor Jair Bolsonaro.
Haddad is determined to bring about the changes that need to happen in Brazil to make the country a thriving and regulated economy. In an interview with the news portal UOL, the minister detailed how he plans to enact his plan. Haddad minced no words in describing what online gambling companies – the source of his indignation – were doing right now.
In his opinion, many companies were simply taking money out of the country without giving anything back in return. The numbers are a bit of a muddle, too, as nobody really knows how much the country stands to benefit from the new proposal. However, the ministry has a good idea of what the tax exemption would cost the country, around at least $616 million at initial estimates.
Tax Revenue Needed to Fill Budget Gaps
Taxing online betting in Brazil can help offset much if not all of this, and finally introduce the law necessary to turn online bookmakers into fair taxpayers in the country. While shifting the blame to operators could be convenient, it’s worth reminding that it was ultimately President Bolsonaro’s government which repeatedly failed to advance the matter and decided to launch sports gambling in a regulated form without any clear view of how the taxation of the activity would take place.
At the same time, sportsbooks have been proliferating across Latin America and Brazil in particular. Many overseas companies have come to provide sponsorships for soccer clubs and signed partnerships with prominent local athletes to consolidate their presence in the country and elicit stronger reactions from sports betting audiences.