Brazil Edges Closer to Regulation, But Will Help Arrive in Time?Published November 16, 2016 by Lee R
Billions in tax revenue are on the table with a regulated model.
The passage of Brazilian legislative reforms by a committee in the Senate was a major step forward in providing needed relief to the Latin sector’s largest economy.
The New Bill
The Special Committee on National Development (CDEN) has approved bill SB 186/2014, opening the door for the introduction of land-based casinos, video lottery terminals and further gambling options such as bingo, online sports betting and casino products.
Illegal Gambling in Brazil
With gambling currently outlawed in Brazil, the most popular forms of betting take place underground, most notably the “Jogo do Bicho” lottery game played in a reported 25 states across South America’s largest country.
The original version of the CDEN bill was submitted to legislature last December. The proposal of 16 new amendments by Senators resulted in a re-draft and the new vote.
New measures include the requirement that at least 40 percent of land-based casinos be built in the Central, Northeast, and North regions, and the delegation of exclusive online sports betting rights to national lottery operator Caixa Economica Federal and its subsidiaries.
Moving It Along
The next step for Bill SB 186/2014 is full Senate approval, with said hearing expected to take place this week.
William Hill calls the contemporary notion of legalising casinos in Brazil “one of the most significant events in gaming history.” Experts calculate that passage of the bill could bring Brazil a range of some $3bn per year in casino tax revenue.
Revenues Walking Away
Those lofty estimates are based on the fact that lawful casino traffic in Brazil has taken to travelling across borders to play. The President of the Brazilian Institute of Gaming estimates that as many as 200,000 Brazilians travel each month to comprise 70% of the clientele playing in Uruguayan casinos today.
Brazilian Economic Woes
With the current state of the Brazilian economy in tatters, the Brazilian government can be classified as nothing short of desperate for additional tax revenue, according to Eilers and Krejcik Gaming.
With the Brazilian government facing a $5.5 billion shortfall at the end of the year and a new credit rating downgraded by Standard and Poor’s to BBB, or one classification above the dubious “junk” rating, Brazil needs to cut though the red tape as soon as possible.