In a pivotal move for Brazil's sports betting landscape, the Senate Plenary voted on December 12 to approve amendments to Bill 3,626/2023, marking a significant step towards the regulation of sports betting in the country. The bill, originally scheduled for a vote on December 6, experienced a delay due to a lack of available senators.
Senator Angelo Coronel presented the bill to the Senate, which included the latest amendments following the initial approval by Brazil's Economic Affairs Commission three weeks prior. While the legislation faced substantial opposition, the Senate focused on three key aspects during the recent voting session.
The most notable decision was the removal of igaming from the bill, a move proposed by Senator Carlos Portinho and backed by 37 votes in favor, with 27 against. Additionally, the Senate voted to exclude virtual games and sports betting terminals, while an amendment prohibiting sports betting advertising in stadiums was rejected.
The Senate's approval also encompassed all taxation recommendations introduced by the Economic Affairs Commission on November 22. As a result, gross gaming revenue (GGR) will be limited to 12%, down from the initially proposed 18%. Furthermore, the taxation on bettors' winnings has been modified, with bettors now taxed once a year at a rate of 15% on net winnings, exceeding the exemption threshold of R$2,112.00 (£339/€394/$425).
Licensees will be required to pay an initial fee of up to R$30 million, granting them the right to operate up to five different brands.
With the bill now approved by the Senate, it will return to the Chamber of Deputies. Although the Chamber had previously approved the bill in September, they will need to vote again to agree on the changes made by the Senate. The challenge lies in having the Chamber of Deputies vote on the amendments before the Christmas recess, which begins on December 23 and continues until early February 2024.
The exclusion of igaming from the bill raises questions about the projected taxation revenue, falling significantly short of the initial target of BRL1.6 billion. Now estimated at R$700 million, the absence of online gambling in the bill has altered the anticipated financial outcomes from taxes and license fees.
While the Senate voted to remove igaming, the Chamber of Deputies retains the authority to overturn the exclusion. As a result, the fate of igaming in Brazil's sports betting regulation remains uncertain, with potential developments expected during the upcoming vote in the Chamber of Deputies. The contentious nature of the igaming issue ensures that the story is far from over, and the Chamber of Deputies' decision will play a crucial role in shaping Brazil's sports betting landscape.
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Joseph Vrachimis CEO at BetConsultant.Cy