Alckmin's Ministry says bets did not cause a drop in retail sales or an increase in debt.

The Ministry of Development, Industry, Trade and Services of the Lula (PT) government refutes, in a technical note, information that spending on online sports betting has caused a drop in retail sales and increased household debt. The ministry also questions conclusions from the Central Bank regarding household spending on betting, according to a report in Folha de S.Paulo.

The document was prepared by the ministry headed by Vice President Geraldo Alckmin (PSB) at the request of the AGU (Attorney General's Office). The request was made because of a lawsuit in the STF (Supreme Federal Court) seeking the suspension of the betting law.

The sector is in the process of being regulated by the Lula government, overseen by the team of Finance Minister Fernando Haddad.

The action was initiated by the CNC (National Confederation of Commerce of Goods, Services and Tourism). The organization says that the expansion of gambling in Brazil has triggered household debt and considerably harmed the domestic economy, retail trade, and social development.

In the Ministry of Development document, the argument is that trade data in the country does not allow for the identification of a slowdown in the sector. The technical note, signed last Friday (4), provides data on the performance of the retail sector.

"Data provided by IBGE indicates that commerce in Brazil is growing, with retail sales showing the following variations: In July 2024, sales grew 0,6% compared to June. In the first half of 2024, retail trade accumulated a 5,3% increase. In the last 12 months up to July, retail trade accumulated a 3,7% increase."

When questioned by Folha, the CNC reiterated information released in September, with a "downward revision of the growth projection for the retail sector in 2024," which would change from 2,2% to 2,1%. "The change reflects the negative impact caused by the uncontrolled increase in online gambling," the text says.

The news report also sought comments from the Attorney General's Office and the Treasury Department, but received no response.

In the technical note, the Ministry of Development also states that "it is even more complex to attribute any variation in the sector's results to spending on betting and gambling," questioning, among other things, data presented by the Central Bank in a note sent to Senator Omar Aziz (PSD-AM).

The Central Bank's statement caused a strong reaction within the government, the retail sector, and Congress. The document concluded that in August alone, beneficiaries of the Bolsa Família program transferred R$ 3 billion to betting sites via Pix payments. Throughout this year, the monthly gross transfer amounts to betting sites ranged between R$ 18 billion and R$ 21 billion.

The Lula government's ministry questions these conclusions, indicating difficulties with the correct registration of the websites' economic activities. "These figures represent gross betting amounts, without considering prizes paid to bettors, which would result in lower net spending on bets."

Folha had already shown that the Central Bank's report leaves gaps and that members of the Ministry of Finance were awaiting more details about the methodology adopted in this study.

When contacted, the Central Bank declined to comment.

When questioned, the Ministry of Development stated that the note does not dispute information from the Central Bank, but "only affirms that, with the official data available, it is not possible to technically assess the impact of the bets." And that, for this, "a more comprehensive study would be necessary, also considering the interaction of other economic variables."

The ministry also emphasized that the issue is considered relevant and that it will follow up and monitor the topic, especially from the perspective of its impact on retail trade—which is also described in the technical note.

Regarding household debt, the ministry headed by Alckmin uses Central Bank data to conclude that there is stability, according to data related to the first half of the year.

"There is a certain stability in household debt with the National Financial System in relation to accumulated income over the last 12 months, going from 48,25% in August 2023 to 47,83% at the beginning of 2024 and, finally, 47,93% in July 2024," the text says.

The note was prepared by the General Coordination of Sectoral Institutional Articulation, of the Department of Commerce and Services of the ministry.