Brazil’s Secretariat of Prizes and Betting (SPA) has published a new ‘technical notice’ providing instructions on the auditing and reporting of income generated by licensed operators under the Brazil Bets regime.
Technical Notice No. 299 outlines the SPA’s rules for Bets-licensed operators regarding the submission of audited accounts and the calculation applied to Gross Gaming Revenue (GGR).
As documented, the SPA dictates that GGR should be calculated as: Total revenue from bets – (Prizes paid to winners + Income tax on prizes).
The SPA underlined the importance of operators maintaining GGR standards, as taxes collected from Bets incumbents will be distributed to multiple social allocations, as mandated by Law No. 14,790/2023, which governs the Bets regime.
As of 1 January 2025, Brazil-licensed operators must pay a 12% tax on GGR income. The GGR calculation will also be applied to tax collection duties for COFINS, PIS, and ISS.
GGR and Corporate Taxes
- Social Assistance Contribution (COFINS): A federal tax imposed on a monthly basis, calculated as a percentage of revenue, with a tax rate of 7.6%.
- Contribution to the Social Integration Program (PIS): Another federal social contribution, also calculated monthly as a percentage of revenue, levied at a rate of 1.65%.
- Municipal Service Tax (ISS) (applicable once in force): A monthly municipal tax, with rates varying by municipality, typically ranging between 2% and 5%.
In addition, operators must pay a monthly oversight fee to the SPA, ranging from BRL 54,419.56 to BRL 1,944,000.00, depending on the GGR of each month.
Allocation of Bets taxes
The revenue generated by the Bets regime will be allocated to the following organisations and programmes:
Federal Sports
- 7.30% — To entities within the National Sports System and athletes.
- 2.20% — To the Brazilian Olympic Committee (COB), which supports Olympic sports and athletes.
- 1.30% — To the Brazilian Paralympic Committee (CPB), which supports Paralympic sports and athletes.
- 0.70% — To the Brazilian Club Committee (CBC), promoting sports at the club level.
- 0.50% — To the Brazilian School Sports Confederation (CBDE), focusing on school-level sports.
- 0.50% — To the Brazilian University Sports Confederation (CBDU), supporting university-level sports.
- 0.30% — To the Brazilian Paralympic Club Committee (CBCP), which supports clubs engaged in Paralympic sports.
Civil Society
- 0.20% — To Fenapaes (National Federation of APAEs), an organisation that provides support for people with disabilities.
- 0.20% — To Fenapestalozzi, an organisation offering educational, health, and social services to people with disabilities.
- 0.10% — To the Brazilian Red Cross, which provides humanitarian aid and emergency assistance.
Future Developments
Audited accounts must be filed monthly with SIGAP, the management system for Bets licences.
Going forward, the SPA will continue to evaluate improvements and recommend efficiencies in reporting duties for licensed operators. The SPA has stated that its goal is to “improve its accuracy and oversight of the market on key duties.”
Taxation remains an evolving issue for the Bets regime, as in 2025, the Senate will begin hearings on whether to apply selective taxes on online gambling operators.
The application of ‘sin taxes’ on gambling businesses was proposed by Senator Eduardo Braga, as part of his review of federal tax policies for the Senate.