Brazil details rules for reporting online gaming income
The new gaming regulator’s technical notice details how licensees’ revenue will be audited.
Brazil.- The new Brazilian gambling regulator, the Secretariat of Prizes and Betting (SPA), has published a technical notice detailing how the income of online gaming operators must be reported and audited. The publication comes after a regulated online gambling regime began in Brazil on January 1 following the issuance of 71 licences.
Technical Notice No. 299 provides details on the rules for how licensees should submit audited accounts and how to calculate gross gaming revenue (GGR). Regarding the latter, the SPA states that GGR should be calculated as: total revenue from bets – (prizes paid to winners + income tax on prizes).
Licensed operators must pay a 12 per cent tax on GGR, and the calculation will also be used for tax collection for COFINS, PIS and ISS. COFINS, a federal social assistance contribution is charged monthly at 7.6 per cent of revenue. PIS, the contribution to the Social Integration Program, is charged monthly at 1.65 per cent of GGR, and ISS, the monthly municipal service tax, once implemented, will vary between 2 and 5 per cent depending on the municipality in question.
Operators must also pay a monthly regulatory oversight fee to the SPA. This will range between BRL 54,419.56 (€9,070) and BRL 1,944,000.00 (€324,000) depending on monthly GGR.
Operators must file audited accounts monthly via the management system SIGAP. The SPA says it will evaluate how the system works and make recommendations to improve efficiencies if needed.
The SPA stressed that operators must respect the instructions, noting that taxes collected will go to various allocations under Law No. 14,790/2023. Funds for federal sports will be split 7.30 per cent for entities in the National Sports System and athletes, 2.20 per cent to the Brazilian Olympic Committee (COB) and 1.30 per cent to the Brazilian Paralympic Committee (CPB), with smaller portions going to other sports bodies. Meanwhile, smaller proportions of GGR tax will go to the disability support bodies Fenapaes and Fenapestalozzi and to the Brazilian Red Cross.
The Senate is still due to debate a proposal from Senator Eduardo Braga to add a so-called “sin tax” on online gambling operators.
Land-based gambling in Brazil
It’s been reported that Brazil’s federal police force has expressed opposition to the proposed regulation of land-based casinos. It argues that venues could be used for money laundering, adding to its workload.
Following the launch of regulated online gambling in Brazil on January 1, a long-delayed bill on land-based gaming in Brazil is expected to be debated in the coming months. Bill No. 2,234/2022 would permit land-based casinos, horseracing, betting, bingo and jogo do bicho (instant win) sales, lifting then-president Gaspar Dutra’s 1946 decree banning casinos from Brazil’s municipalities and districts.
However, the proposal still faces strong opposition, including from politicians such as Eduardo Girão (NOVO) and members of the evangelical contingent. A vote on the bill was postponed in December and is now expected in the first half of this year.
