Brazil’s government has issued a provisional decree that will legalize sports betting and tax companies’ revenues by 18%.
President Luiz Inacio Lula da Silva’s decree, Provisional Measure No-1182, was sent to congress and must be voted on within the next 120 days. According to reports, Brazil’s finance ministry projected tax revenues of at least R$2 billion ($420 million) in the first 12 months of operation.
Gambling companies will be allowed to apply for a grant from public authorities ahead of securing a defined-term license to operate. The expected cost for a five year license is R$30 million ($6.3 million).
The decree also states that bettors must pay income tax at a rate of 30% if winnings on any bet are more than R$2,112 ($446).
The recent push to legalize sports betting follows the introduction of sports betting legislation by Brazil’s Minister of Finance Fernando Haddad. At the time, the minister said that he hoped the bill would prevent offshore sportsbooks from profiting.
Lawmakers have already explored the possibility of establishing a regulated sports betting industry. Just last year a provisional decree with similar wording to the most recent one failed to receive a signature from outgoing President Jair Bolsonaro. However, there is now more support from current lawmakers and the new president.
The government now hopes that the regulated industry can now launch within the next few months.
The decree follows a dark period in Brazilian sport after an investigation revealed that many soccer players were offered significant sums to influence the games they played in or perform specific actions. According to the investigation, some players were offered between $10,000 and $20,000 to give away penalties or get yellow cards.
The investigation includes about 20 matches in Brazil’s first and second divisions, plus some local state leagues. At present 31 people have been charged including 15 players in the first and second divisions.
Based in London, Natasha is a former sports journalist with experience working for some of the biggest athletes & brands in the world of sports and iGaming.