A technical note from the Ministry of Development contradicted the accusations from trade associations and the report from the Central Bank regarding the spending on betting by the beneficiaries of the Bolsa Família program.
Brazil.- The Ministry of Development, Industry, Commerce and Services refuted, in a technical note, information suggesting that spending on online sports betting caused a decline in retail trade and increased the indebtedness of the population. The department also questioned the conclusions published in a report from the Central Bank about family spending on betting, especially from those benefiting from social plans.
The document was prepared by the ministry led by Vice President Geraldo Alckmin at the request of the AGU (Attorney General of the Union). The request was made following a judicial action by the STF (Federal Supreme Court) requesting the suspension of the betting law.
The action was initiated by the CNC (National Confederation of Commerce of Goods, Services and Tourism). The entity claims that the expansion of betting in Brazil has triggered family indebtedness and significantly harmed the national economy, retail trade, and social development.
In the document from the Ministry of Development, it is argued that the country's commercial data do not allow identifying a slowdown in the sector. The technical note provides data on the performance of the retail sector. “The data made available by the Brazilian Institute of Geography and Statistics (IBGE) indicate that commerce in Brazil is growing, with retail sales showing the following variations: In July 2024, sales grew by 0.6 percent compared to June. In the first half of 2024, retail trade accumulated an increase of 5.3 percent. In the last 12 months until July, retail trade accumulated an increase of 3.7 percent,” highlights the government document.
After the publication, the CNC reiterated the information published in September, with “a downward revision of the growth projection for the retail sector in 2024,” which would go from 2.2 percent to 2.1 percent. “The change reflects the negative impact caused by the uncontrolled increase of online betting,” says the text.
In the technical note, the ministry also states that “it is even more complex to attribute any variation in the sector's results to spending on betting and gambling,” even questioning the data presented by the Central Bank in a note sent to Senator Omar Aziz last week.
The note from the Central Bank caused strong repercussions in the government, the retail sector, and Congress. The document concludes that only in August, the beneficiaries of the social plan Bolsa Família would have transferred R$ 3.000m (USD 539m) for bets in payments via the virtual payment platform Pix.
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The ministry of Lula's government questions these conclusions, pointing out difficulties with the correct registration of economic activities on websites. “Such values represent gross values of bets, without considering the prizes paid to bettors, which would result in lower net spending on betting”.
The report from the Central Bank had already generated rejection by the government and the Ministry of Finance had questioned the figures released and had demanded that the methodology applied to arrive at such conclusions be disclosed.
