Selective Tax: ANJL warns that Brazil will fail in regulating the betting market if there is no tax efficiency

At a Senate session, tax law professor Ana Helena Pamplona, a tax law professor and ANJL consultant emphasised that over-taxing the sector will stimulate socio-economic problems

In her speech, Ana Helena Pamplona, commented that a possible increase in the tax burden, which is already one of the highest in the world, will drive gamblers to illegal sites, stimulating the socio-economic problems resulting from irresponsible gambling.

‘What's the big problem? If there is excessive taxation, what we want to combat, which is health problems, will stop people who develop some kind of illness from taking part, and they will end up being encouraged out of the legal market and out of the eyes of the state. And then it will be much worse,’ said Pamplona.

In her presentation, the tax expert showed examples from around the world of players migrating to illegal sites in countries with high tax burdens. She mentioned that while the UK taxes bets at around 15% and has a 90% channelling rate to regulated sites, France imposes a tax of around 45% and manages to channel only half of its players to the legal market.

‘We use these countries as a reference, but in terms of the total tax burden. We have to remember that the sector already has an additional 12 per cent, provided for in specific legislation,’ said Pamplona, referring to the GGR (Gross Gaming Revenue), to be paid by bookmakers and set by Law 14.790/2023. ‘Further burdening the sector could be detrimental. The success of the tax regime means success in regulation,’ she adds.

During the public hearing, the expert also emphasised that the Selective Tax has an extra-fiscal, non-collective objective. The current version of the tax reform regulation bill (PLP 68/2024) goes against this, creating a scenario of tax inefficiency that will harm the country. ‘We need to make changes in line with the best tax practices so that this regime is successful and, as a result, migration to the regular market, greater consumer protection, resources for the state and, therefore, an increase in Brazil's GDP,’ said the ANJL consultant.

Launched in March 2023, the National Association of Games and Lotteries defends the interests of its members, of the sector and of responsible and honest gambling, always guided by the encouragement of sport, the security of bets and the contribution to the country's economic development.