Yesterday’s debate saw the Senate discuss the potential positive impact of legal casinos in Brazil and other forms of land-based gaming.
Senators talked up the economic benefits such as new tax revenue and job creation. Discussions also turned to potential negative impacts and how to mitigate issues such as gambling addiction.
The Justice and Citizenship Commission approved PL 2,234/2022 back in June, passing it by 14 votes to 12. The next step to regulation of Brazil casinos was a vote by the senate plenary following its return from recess on 1 August.
However, while a debate was called for Thursday, CNN reports suggested the vote could be pushed back until October following the first round of municipal elections, slated for 6 October.
Brazil casinos: Debate happened, voting didn’t
The debate took place as scheduled on Thursday. But with no vote taken, and it currently remains unclear whether that vote will indeed be delayed until October or if it could get done within the next couple of weeks.
Discussing a proposal that was first presented to the chamber of deputies in 1991, gambling critics such as Eduardo Girão pointed to aspects such as the potential rise of addiction as a key reason not to legalise casinos.
Senator raises addiction concerns
Claiming gambling “completely devastates” citizens’ lives, Girão highlighted a US study from Professor Earl Grinols that claims for every $1 taxed on gambling, another $3 is spent by the state on social issues caused by betting.
“Do you know what happens with suicide in relation to gambling?” Girão said. “The rates are 12 times higher in people who are addicted to gambling.
“Gambling is the big moneymaker. Around 40% of casinos’ revenue comes from gambling addicts. How are they going to give that up? They won’t.”
Senator Damares Alves and pastor Silas Malafaia agreed with Girão on the fears over addiction levels, while both also raised concerns about a potential rise in organised crime and money laundering.
Does regulation mitigate potential negative impact?
However, Senator Irajá responded to the concerns arguing they were taken into consideration when the proposal was drafted.
A ban on credit cards, with payments only available through Pix or debit cards, is one step taken. There will also be a rule to prevent bank loans for gambling in order to minimise the dangers of gambling harms.
Leonardo Henrique Benites de Prado, an expert on gaming and betting regulation, had sympathy for the concerns over addiction.
However, he also defended the industry over its efforts to counter such issues with regulation.
‘Gambling addiction affects a tiny portion of society’
“The problem with gambling addiction affects a tiny portion of society, and we cannot restrict the freedom of the vast majority because we will have a problem with the minority,” De Prado said.
“Around 12.5% of people who consume alcohol are alcoholics. This number is many times higher than the problem of gambling addiction.”
In response to money laundering fears, Irajá stressed cash payments won’t be allowed, with monitoring of digital betting methods mandatory.
“The entire process is subject to audit, because it has a basis, and can be monitored by control agencies, such as the Federal Revenue Service, the Federal Police and all other agencies that wish, in some way, to establish a relationship of transparency with what is happening in this financial movement,” Irajá explained.
Economic benefits of casinos in Brazil
Irajá also noted the economic benefits that have been observed in other countries who have legalised gambling.
For instance, he pointed to the G20, which includes the 20 largest world economies. Of those 20 nations, only Brazil and Indonesia – a majority Muslim country – are yet to legalise gambling.
The economic benefits come in the form of increased tourism. The national secretary of Infrastructure, Credit and Investments of the Ministry of Tourism Carlos Henrique Sobral expects the legal casinos in Brazil to create over 650,000 jobs and increase revenue by BRL74bn (£10.4bn/€12.2bn/$13.3bn).
Hotels are also set to profit from the legalisation of casinos. An amendment from Irajá allows hotels to add casinos and bingo halls.
Government relations manager of the Brazilian Association of Event Promoters (Abrape) Lucas Gabriel Barbosa is very keen to see the change implemented and the bill passed.
“I would like to say that it is this guarantee that will bring all the benefits to the events chain,” Barbosa explained. “It is this guarantee that brings the favourable positioning and enthusiasm of the Brazilian events sector with the approval of Bill 2,234.”
But when will Senators vote on Brazil casinos?
Senate president Rodrigo Pacheco is prioritising matters such as tax and state debt over the gambling bill.
During the debate session, he said the bill required further discussion to fully analyse the advantages and disadvantages of legalising casinos.
Pacheco said: “We must carefully evaluate potential benefits, such as job creation and revenue for the Brazilian state, but also the risks and challenges, including preventing money laundering and combating organised crime, in addition to the social and public health problem related to gambling addiction.”
This suggests there will be further debate before the bill goes to a vote. The October timeline may soon be a reality.
Original article: https://igamingbusiness.com/legal-compliance/regulation/brazil-no-vote-casinos-bill/
