ANJL warns of attempts to "tax the past" and selective investigations.
The National Association of Games and Lotteries (ANJL) contests the operation launched by the Federal Revenue Service and the Public Prosecutor's Office against a sports betting company in Recife, this Friday (August 28). For the entity, the offensive has a media bias and is selective and relies on an unconstitutional legal thesis: the retroactive taxation of companies in the sector.
The central complaint, published by JC-PE, revolves around the attempt to criminalize and tax financial transactions carried out before the regulation of the betting market in Brazil. Bernardo Freire, legal director of ANJL, argues that the tax violates fundamental principles of the Brazilian legal system.
"The taxation in the past was not validated or did not happen because there is no legal basis, there is nothing in the Brazilian Constitution that allows it. You cannot tax what did not exist," stated Bernardo Freire.
The regulatory limbo of betting
Between 2018, when the sector received initial authorization, and 2024, when practical regulation came into effect, betting companies operated without a defined tax framework. According to ANJL, the lack of economic activity classification with the Federal Revenue Service and an official collection channel prevented platforms from declaring income tax on gaming operations. “How could you pay taxes before regulation? You couldn't because you didn't even have a tax framework,” Freire emphasized.
In the absence of regulation, the country's leading law firms devised an alternative structure considered legitimate: establishing their corporate headquarters abroad and contracting service providers in Brazil. When a bettor placed a wager, the money was transferred abroad by partner financial institutions and deposited into a so-called "stakeout account." These international transfers were subject to a 1,5% IOF (Tax on Financial Operations) on the sending of the money and another 1,5% on the return of the prize to the bettor. Bernardo Freire estimates that "around 90% to 100% of companies used this structure," refuting accusations that the model constituted money laundering.
Version from the Federal Revenue Service
The Special Secretary of the Federal Revenue Service, Robinson Barreirinhas, presented the opposite argument. According to him, there is evidence that the betting activity had already been operating in the country for about seven years, which would correspond to approximately five years before the authorization for the regular operation of the sector. "The evidence shows that this organization was already present in Brazil, with employees and beneficiaries in the country, but without paying any taxes or being subject to Brazilian regulation," declared Robinson Barreirinhas.
ANJL also contests the way the operation was conducted, stating that the companies under investigation had previously made themselves available to the authorities to provide clarifications and open their accounts collaboratively. The association also points to a "regional selectivity" in the investigations, which targeted brands founded by entrepreneurs from Pernambuco and the Northeast region of Brazil.
Economic relevance of the sector
The entity highlights the economic importance of the companies under investigation. The Betnacional platform, for example, was the protagonist of the largest M&A (merger and acquisition) in the history of Pernambuco, in a transaction that resulted in the payment of more than R$ 1 billion in taxes. The company maintains approximately 2.000 direct jobs.
ANJL emphasizes that the betting segment sought self-regulation and voluntary tax payment even before the federal government formulated a legal framework for the sector.
In a statement released after Friday's operation (August 28), the association said it is closely monitoring information from the Federal Revenue Service and expressed concern about possible violations of constitutional guarantees. "ANJL views with concern any situations, within the scope of investigations and proceedings related to the betting sector, that may result in violations of the constitutional principles of presumption of innocence, due process, and the right to a full defense. These principles are fundamental to the Democratic Rule of Law and must be guaranteed to all, regardless of the nature of the investigation or the economic activity carried out."
The association reiterated its confidence in the actions of the competent institutions and in the "regular review of the processes by the Judiciary, with due observance of constitutional guarantees and the right to defense of the parties involved." ANJL added that "any liabilities should be investigated within the appropriate procedures, respecting due process and the decisions of the competent authorities."
