Gustavo José de Guimarães, the new secretary of SECAP, the agency leading Brazilian public policy development for the agriculture, energy and lottery sectors, has revealed that the government expects the sports betting industry to be regulated before the end of the year and up and running by 2022.
According to comments made by local outlet Valor, shared by BNL Data, Guimarães assured that the goal is to have the sports betting market operational in Brazil before the FIFA World Cup in 2022, although the government is aware that reaching this date will be a challenge.
Last week, Brazilian President Jair Bolsonaro signed off on a federal law that regulates a number of industries, including sports betting. The modified article restructures the tax regime base to GGR instead of a gross wagering value of bets, as originally proposed.
This change, according to Guimarães, aligns Brazil’s law with international practises and makes the local market more attractive to investors.
“It’s an amendment, but it’s now in line with what the secretariat has been discussing. The 2018 law was very important, but in terms of taxes it was very different from what we can see in international practices,” he said.
“We discussed this subject with market agents, international regulators and potential investors,” he said, adding that they reached a conclusion that the law would damage the appeal of the Brazilian industry.
Meanwhile, the secretary revealed that the government expects to collect $1.5bn annually, instead of a previous estimation of $380m. The Treasury would also be able to receive around $135m every year.
Moreover, Guimarães said that this sports betting modality justifies changing the tax model, as when a fixed-odds bets model is adopted, operators face the possibility of experiencing negative results. On the flip side, this new regime would help operators generate higher revenues.
The secretary took over the position last month, replacing Pedro Calhman de Miranda, who had been in charge of the secretariat since August 2020. In addition to facing the challenge of starting a local sports betting market, Guimarães will also oversee the launch of new state lotteries and the instant lottery Lotex.