Brazil to tax online sports betting, says finance minister


By Marcela Ayres

BRASILIA, March 1 (Reuters) - Brazil plans to start taxing sports betting and will propose the measure as early as this month, Finance Minister Fernando Haddad said on Wednesday, in an effort to boost fiscal revenue to offset increased social spending.

In an interview with news portal UOL, he stated that the measure will be taken to compensate for the increase in income tax exemption for workers who earn up to twice the minimum wage, promised by leftist President Luiz Inacio Lula da Silva.

"I will regulate online gambling," said Haddad. "They don't pay any taxes and take a fortune of money from the country."

A law passed in 2018 allowed for the first time in Brazil online fixed odds betting, where bookmakers offer odds on the outcome of sports events.

The taxation proposal in 2021 targeted market revenues estimated at about 2 billion reais ($385 million) a year that was being remitted abroad.

Haddad said that there are no precise estimates yet of how much can be raised through the regulation. His Treasury Secretary had already said that the increase in income tax exemption would cost about 3.2 billion reais ($616 million).

A source from the Finance Ministry, speaking on condition of anonymity since the measure is still being prepared, said that preliminary figures point to a potential revenue of 2 billion to 6 billion reais from the taxation of online sports betting.

Internet sports betting companies have been growing worldwide and boosting their presence in the country, having sponsored major soccer clubs in recent years, ensuring brand exposure during matches. They include sites such as bet365, Betano and Betfair.

($1 = 5.1929 reais)

(Reporting by Marcela Ayres; Editing by Steven Grattan and Alistair Bell)

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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