As tensions rise in Brazil’s regulated gambling landscape, a major industry association is hitting back against perceived misinformation from a prominent retail group.
The National Association of Games and Lotteries (ANJL) has taken legal action against the Brazilian Association of Supermarkets (ABRAS), demanding clarity on the information featured in a controversial video shared on ABRAS’s social media channels. This video, titled "History of Bets," suggests a connection between regulated betting and Brazil’s food insecurity crisis.
In their video, ABRAS argues that every real spent on gambling translates to “one less meal at the table” and can lead to delayed bill payments. They claim that retail businesses lost BRL103 billion ($18.7 million) in revenue last year due to gambling expenditures.
Countering ABRAS’s claims, the ANJL presented statistics from the Brazilian Institute of Geography and Statistics, which indicate that the retail sector actually experienced a 4.7% growth over the same period.
From the ANJL’s perspective, the video doesn’t just critique individual entities; it casts a shadow over the entire betting industry. ANJL President Plínio Lemos Jorge expressed concern that the retail sector has chosen to scapegoat betting companies for rising food prices. “This is a problematic narrative,” he stated, emphasizing that the regulated gambling sector is expected to contribute over BRL4 billion in taxes this year alone. He argued that simplifying Brazil’s economic challenges to the betting industry is both irresponsible and misleading.
Addressing the ‘Silent Predator’ Allegation
The ANJL also took offense at the portrayal of online gambling as a “silent predator.” They argue that the video is misleading and infused with inaccuracies. ANJL contends that it fails to clearly distinguish between legitimate betting operators and illegal entities, which significantly divert funds away from public resources.
“Nobody is sneaking in, as suggested,” continued Lemos Jorge. “Licensed operators are publicly listed and accessible through federal government portals, which regularly updates their authorizations.”
He added that while ABRAS may oppose the betting sector, spreading false information is unacceptable.
Challenging Claims About Taxation Rates
The ABRAS video further asserts that gambling operators pay only 12% in taxes, contrasting it unfavorably with the higher tax obligations faced by the retail sector. “It makes no sense for a gambling entity to pay less tax than we do for food,” the video proclaimed.
In response, ANJL labeled this 12% figure as misleading, clarifying that it pertains solely to gross gaming revenue. When factoring in additional taxes like PIS/Cofins and municipal contributions, the effective tax rate is around 38%. There’s also an impending increase, as a recent provisional government measure aims to raise the gross gaming revenue tax to 18%, marking a 50% hike.
Although this measure is in effect immediately, Brazilian law stipulates that collection of these new rates will commence 90 days after its publication on June 11. Additionally, the Senate and Chamber of Deputies will have 120 days to vote on making this tax increase permanent.
As the debate unfolds, it underscores the complexities and challenges facing Brazil’s gambling and retail industries amid shifting economic landscapes.