Industry Leaders Rally Against Tax Proposal
In a bold move that could reshape the landscape of online gambling in Brazil, the Brazilian Institute of Responsible Gaming (IBJR) has publicly criticized the government's proposal to increase sports betting tax rates from 12% to 18%. This decision comes amidst concerns over the potential consequences it may have on both legal operators and overall tax revenues. According to IBJR, if implemented, the new tax could drive more bettors towards unregulated platforms, escalating the percentage of illicit activity to as much as 60% of the market.
The Finance Minister, Fernando Haddad, defended the proposal during a recent press conference aimed at addressing Brazil's fiscal challenges. The suggested tax increase aims to compensate for the cancellation of the Financial Transactions Tax (IOF). However, the IBJR argues that penalizing lawful operators will not resolve the financial issues at hand but rather exacerbate them. They believe that lawful companies, who have invested significantly in the regulated market, would suffer the most, leading to a decline in public revenue rather than the intended boost.
IBJR articulated in a detailed statement that escalated taxation on legitimate operators would not only create an environment of legal uncertainty but would also risk pushing consumers towards illegal gambling avenues. They emphasized the necessity for the government to focus on combating illegitimate businesses rather than placing undue burdens on those following regulations.
In light of these developments, the IBJR has pledged to engage in dialogue with government officials and the National Congress to communicate their opposition more effectively. They have also indicated the possibility of legal action should the situation not improve, asserting that they will not stand by as their industry is used as a scapegoat for fiscal mismanagement. The collective voices of various trade associations underline the urgency of their message—it is critical to safeguard the integrity of the regulated gambling sector in Brazil.
As the debate continues, all eyes will be on the government’s next moves. The IBJR’s firm stance indicates that significant pushback is likely if the proposed tax increase goes through as planned, potentially reshaping the future of online betting in the country for years to come.