Senators and deputies considered this Thursday afternoon (9) the vetoes of the Presidency of the Republic to several laws, including Law No. 14,790, which regulated the sports betting market.

With a majority, parliamentarians overturned President Lula’s veto regarding the taxation of gamblers . The Presidency of the Republic will be notified and the rejected vetoes will be enacted.

Provisions 1 to 3 of veto no. 49 of 2023 were analyzed. As a result, the original wording of the law approved by the Chamber of Deputies last year is maintained.

The change means that the tax on bettors will be levied on net prizes that exceed the value of the first bracket of the annual progressive IRPF table. This decision had already been made in a regulation published by the Federal Revenue Service earlier this week.

Taxation will be levied on the net prize, which represents the positive result obtained from fixed-odds bets placed each year, after deducting losses incurred from bets of the same nature.

The sector has been advocating the overturning of the vetoes since the law was passed in December last year. The Brazilian Sports Betting Association (Abaesp) was running a campaign to get members of parliament to change the legislation.

“The way it is, it means that every winning bet, regardless of the amount, would be taxed at 15%. We joined forces with the industry to understand that this is a huge mistake. It encourages illegal gambling, it encourages operations that will not have a license in Brazil,” said the association’s president, Rodrigo Alves, in an interview with Aposta Legal Brasil in early April.

Vetoes were seen as unfair

The sports betting market was mobilizing to overturn the vetoes on the provisions regarding the tax on bettors.

For lawyer Nelson Willians, gamblers could be attracted to the illegal market if the law were maintained with the wording sanctioned. He spoke about the subject in April, during Bis Sigma 2024.

Former special advisor to the Ministry of Finance, José Francisco Mansur also took a stand, stating that the text with the vetoes lacked clarity.

“We need to define what net revenue is and when the tax will be calculated. If it is daily, it will be a huge loss for the bettor. If it is annual, the bank always wins. Perhaps a middle ground is needed, on a monthly basis,” he said.

The veto on provision 1, which defines the net premium, was rejected by 414 deputies and 64 senators. In total, 417 deputies and 64 senators supported the tax exemption bracket. The third provision was rejected by 417 deputies and 63 senators through electronic ballot voting.