In the last week, the regulation of the sports betting sector in Brazil was once again debated nationally due to statements by the Minister of Finance, Fernando Haddad. According to Haddad, the lack of tax collection is an ‘illegality’ and facilitates the evasion of foreign exchange.
In addition, the minister was keen to point out that online betting is taxed worldwide and Brazil cannot remain an exception. After all, sports betting is increasingly popular among Brazilians, but there are still no specific regulations in the national territory.
Publicist João Rodrigues published an opinion article on the Poder 360 website, showing how Brazil can benefit from the formalization of regulation for the sector. With fair and transparent rules, the country can become a relevant player in the global industry, bringing benefits to society as a whole. Check out the following article:
Brazil wins with the regulation of sports betting
Finance Minister Fernando Haddad said on March 1 that Brazil should tax sports betting. According to him, the non-collection of taxes is an “illegality” and allows currency evasion: “Gambling on the internet is taxed all over the world. It can’t be any different here.”
Despite the pro-collection speech, the minister did not explain what he will do to ensure that bets are taxed, since Brazil has not yet regulated this type of game. Today, the sites are based abroad and so are the licenses for online gambling.
In order to tax the activity as a whole (and not just the gamblers), it would be necessary to regulate the activity. As a consequence, the country could collect an amount perhaps even greater than estimated by the Minister of Finance, who quoted something in the range of R$ 2 billion to R$ 6 billion per year.
Allowed in several countries, sports betting is increasingly popular. In the 2018 Football World Cup, the volume of bets on the games of that tournament reached 136 billion euros, according to data from Fifa, organizer of the event.
There are still no official numbers on the global figure for betting on the Qatar Cup in 2022, but it is known that it was higher.
In Brazil, the Qatar World Cup was already the event with the highest number of bettors in 2022, surpassing the finals of the Copa Libertadores and the European Champions League. The Brazilian betting market reached a total of BRL 9.8 billion in 2022, with a forecast of reaching BRL 12.5 billion in 2023.
This movement also occurs in national football. The 20 football teams in the Serie A of the Brazilian Football Championship already have some sponsorship from betting companies. It is interesting to note that this reality imposed itself from the outside in, as none of these sponsors is authorized to operate in Brazil.
As the activity is not regulated in Brazil, bookmakers in other countries offer ease for Brazilians through the internet.
Brazil is the largest economy in Latin America and one of the largest in the world. It has huge potential to benefit from the growth of the sports betting industry. But it is necessary for this to be regulated and for companies to be able to establish themselves in the national territory – only then will they be able to be taxed, as Fernando Haddad wishes.
The Minister of Finance is right: the legalization of sports betting in Brazil would generate revenue for the public coffers. The money could be used to finance public services and infrastructure projects. The economy would benefit as a whole.
In addition to producing revenue, the sports betting industry would create jobs. This industry requires hiring professionals for a variety of activities, from compilers and probability analysts to marketing specialists and customer service representatives. These jobs would be spread across multiple areas including finance, marketing and technology, creating a ripple effect that would benefit the economy.
The sports betting industry would also be positive for the sports culture of the country. Brazil has sports in its DNA. There is a unique passion for football among us. The legalization of this type of betting would increase interest and engagement in sporting events, both nationally and internationally.
The regulation of sports betting and casinos (in this case, something more complex from a legal point of view) could help to develop the tourism industry in Brazil. With an abundance of natural beauties, historic landmarks and cultural diversity, Brazil is a destination still little explored by national and international tourists, especially those interested in betting.
While the country does not regulate gambling in casinos, Brazilians travel to Uruguay (Punta del Este) or the United States (Las Vegas) to do tourism and frequent casinos. Not to mention the cruise ships, which receive passengers from Brazil in national ports and open their floating casinos when they are in international waters.
There is a fear on the part of society that the regulation of gambling could cause social problems. It is true that lack of control has the potential to cause financial disruption for individuals and families. This is a legitimate concern. It turns out that, with globalization and the internet, it is impossible to encapsulate Brazil.
International bookmakers operate openly in any country, including here (through the internet). The difference is that, as they are in international territory, they do not pay taxes in Brazil. But Brazilians play anyway.
Regulating sports betting in Brazil – and, even if it is something more difficult, casinos in predetermined areas to encourage tourism – can produce revenue to even help promote user education programs, so that they are aware of the risks involved in this activity.
Ignoring the issue is the worst solution. Brazil cannot be isolated from the world. Regulating is the sensible way to legalize something that already exists in fact and to bring more resources to governments (federal, state and municipal). And, as a main consequence, help create jobs, boost economic activity, enhance the country’s sports culture and attract more foreign tourists.
With the right regulations in place, Brazil could become a major player in the global sports betting market, benefiting all of society.