The recent regulation of fixed-odds betting in Brazil marked an important milestone for iGaming in the country. With exponential growth in recent years, mainly driven by the expansion of digital platforms, the measure was inevitable. In this article for GMB, 1win Partners explores the changes brought about, the influence on the financial market and economy, and discusses the impact of the law on the job market.
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Context and growth of the betting market
In recent years, the betting market in Brazil has experienced remarkable growth. According to recent estimates, about 18.7% of the population aged 18+ has bet or bets in some area, whether it be sports, online casinos, or other modalities. This percentage reflects a global trend, where digital entertainment, including betting, is becoming increasingly popular and accessible.
With the increase in popularity, there was also a growing need for robust regulation. Before the new legislation, the betting market in Brazil operated in a sort of "gray zone," without clear rules that protected consumers or regulated the actions of companies. This led to a scenario of legal and fiscal uncertainty.
Main changes
The new fixed-odds betting law came to fill this gap, introducing a series of rules aimed at regulating the sector. Some of them are:
1. Taxation: The law establishes a taxation of 15% on the net value of the prizes obtained by bettors. This taxation aims to increase government revenue, which had already estimated a significant loss of revenue due to the lack of previous regulation. It is worth noting that the taxation works on the same principle as income tax, with those who obtain winnings smaller than R$ 2,259.20 from the net prize, i.e., the difference between the amount bet and the amount won, being exempt from the tax.
2. Destination of revenues: A significant portion of the revenues collected from taxation will be allocated to essential areas, such as education (10%), public safety (13.60%), sports (36%) and tourism (28%). In addition, 50% of unclaimed prizes will be allocated to FIES (Student Financing Fund) and 50% to FUNCAP (National Fund for the Development of Science and Technology), although it is not clear how long the amount can stay on the platform before being allocated to the funds.
3. Regulation of operators: Betting operators, whether national or international, now need to meet strict requirements set by the Ministry of Finance to operate in Brazil. This includes proving financial capacity, maintaining a customer service channel, and complying with advertising rules aimed at preventing abusive practices.
Impact on the financial market
The regulation of betting has a direct impact on the financial market and the economy. The formalization of this sector attracted significant investments, both from already established companies and new entrants to the market. The estimate is that the betting market may move about R$ 20 billion annually in the coming years, a substantial amount with the potential to transform entire sectors of the economy.
In addition to the increase in tax revenue, the regulation is also creating new job opportunities. With the need for operators to comply with local regulations, companies are expanding their operations in Brazil, creating jobs in technology, customer service, marketing, and compliance areas. The estimate is that the sector may generate tens of thousands of new direct and indirect jobs, especially in regions that historically face economic challenges.
Challenges and future perspectives
Although the regulation is a positive step, there are still challenges to be faced.
One point of debate is the social impact of betting. The law provides for allocations of part of the revenues to programs for the prevention and treatment of gambling addiction, but the effectiveness of these measures will still need to be evaluated over time.
However, the prospects are promising. With the regulation, Brazil aligns with countries that have already regulated the sector and reap the benefits of this formalization, such as increased tax revenue, job creation, and consumer protection. The success of the law will depend on its rigorous application and the government's ability to keep up with the technological innovations that shape the betting market.
Conclusion
The new fixed-odds betting law in Brazil represents a significant transformation for the sector, bringing clarity and security both for companies and consumers. With the potential to move billions of reais and generate thousands of jobs, the regulation of the betting sector is an example of how legislation can be used to transform and energize the economy. However, for these benefits to be fully realized, a continuous effort in education and innovation in monitoring the sector will be essential.
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Source: 1win Partners
Italian humanism of the 15th and 16th centuries and its musical language will be part of the celebrations of the 150 years of Italian Immigration to Brazil with the Festival América Barroca Year II. With the aim of presenting to the public the historical richness of Baroque music and its influence on national culture, the Consulate General of Italy in Belo Horizonte is sponsoring, with the support of Raspadinha®, the performance of Vivaldi's Four Seasons at the Museu Mineiro, this Wednesday (4).
The performance of the Baroque Orchestra Música Figurata, under the direction of Robson Bessa at the harpsichord, will represent the famous work of the Italian musician at the museum that integrates the Cultural Circuit of Praça da Liberdade. In addition, the concert will feature the narration of excerpts from "A Capital," by the Italo-Mineiro writer Avelino Fóscolo, the first novel published about Belo Horizonte, which explores the challenges of building the city.
The event, which includes direction at the harpsichord by Robson Bessa, will also include performances of sung pieces by Eduardo Ribeiro and narration by actress Mari Ozório, in addition to the participation of the spalla of the Minas Gerais Symphony Orchestra and violinist Alexandre Kanji. Admission is free and on a first-come, first-served basis.
This project is made possible with resources from the State Law of Incentive to Culture and is sponsored by the Consulate General of Italy in Belo Horizonte with the support of Raspadinha®, an instant game mode of the Consórcio Mineira da Sorte for the Lottery of the State of Minas Gerais (LEMG).
Service
Vivaldi's Four Seasons - Música figurata and guests
Free Admission (first come, first served)
Date: September 4, 2024
Time: 7:30 PM
Location: Museu Mineiro - Av. João Pinheiro, 342
More information: Festival América Barroca - https://linktr.ee/festival.america.barroca?utm_source=linktree_admin_share
Source: GMB
The Sports Committee of the Chamber of Deputies approved a proposal that redistributes the federal collection with numerical prognosis lotteries (such as Quina, Mega-Sena, and Lotomania) to allocate resources to the Brazilian Committee of Master Sport (CBEM), the Union of Brazilian Sports and the Brazilian Confederation of Sports for the Deaf (CBDS).
Under the proposal, the share of the collection allocated to the Ministry of Sports drops from 2.49% to 2.39%, making room to transfer 0.05% to CBEM, 0.01% to CBDS, and 0.01% to the Union of Brazilian Sports, an entity that represents modalities created in Brazil, such as capoeira, surfing the pororoca, and frescobol.
The text requires that the new resources transferred be applied, exclusively and integrally, in sports, in the training of human resources, in technical preparation and in the transportation of athletes, in participation in sports events, and in the payment of administrative expenses.
Favorable opinion
The report of the rapporteur, deputy Luiz Lima (PL-RJ), was approved in substitution to the Bill 1920/19, by deputy Beto Pereira (PSDB-MS), that is, a substitute. Lima understood that the main idea of the project – to increase the volume of resources transferred to state sports secretaries – is already being analyzed in discussions about the fixed-odds lottery, popularly known as sports betting or "bets".
However, the rapporteur accepted parts of appended bills (PLs 5246/20, 2937/19, and 4205/19). "We advocate for state funding of master sports, essential for promoting physical activity and healthy aging," observed Lima, referring to the transfer of lottery resources to the Brazilian Committee of Master Sport.
"We also value the public incentive for the development of sports modalities created by Brazilians and, in the same way, the development of sports for the deaf," he added.
Next steps
The proposal will still be analyzed, in a conclusive manner, by the Finance and Taxation committees; and of Constitution and Justice. To become law, the text needs to be approved by the Chamber and the Senate.
Source: Chamber of Deputies News Agency
