Brazil to Expand Casino Resorts by State
Brazil is making headway on a new bill to allow the building of resorts across the country, with Veneziano Vital do Rêgo selected as the Plenary Rapporteur to report on the bill’s progress in the legislature. His appointment was recently approved by the Executive Committee.
The Brazilian government is making headway on a bill that will allow one new resort built in each state and an increase of land-based casino activity. ©Vitor Paladini/Unsplash
What is a rapporteur?
The role of a rapporteur is an important part of the legislative process. Though it can differ from government to government and depending on the context of the bill at hand, rapporteurs are usually entrusted with analyzing proposals, delivering reports on their findings, and leading discussions over proposed bills in the legislature.
In this context, do Rêgo will be in charge of representing the resort bill in the Brazilian legislature and making suggestions for how to proceed with its implementation.
Details of the Bill
As originally approved last fall, the bill would allow Brazilian states to introduce integrated resorts. Each state can create one new resort. Casinos may occupy up to 10% of all of these properties.
It is common for resort operators to be chosen through a bidding process and the case in Brazil is no exception. Various companies will offer their proposals to the Brazilian government, and relevant jurors will judge them with a point system based on both the bid’s quality as well as the estimated profit the operator will generate. Part of that profit will be owed back to the Brazilian government.
Once selected, each operator will hold their concession license for 35 years, allowing plenty of time for the building of the property and analysis about the resort’s functioning and profits over time.
Part of the bill states that 80% of the employees of each resort must come from the local area. The idea is to offer jobs to people in every state of Brazil, as a boost to local economies. Aside from this, Brazilian law stipulates that casino-resorts must also abide by strict anti-money laundering standards. One specific measure has to do with player identity: Anyone who deposits or withdraws more than BRL 10,000 ($1,859 US) in a day must have their identity verified by the resort operator in order to play.
The regulation of such rules is still somewhat murky, but may be in part what do Rêgo and his colleagues will iron out in the next months. One thing that is clear is if operators break any of these rules, they could be fined. Fines depend on the severity of the crime, varying between BRL 10,000 and BRL 1 million ($191,813.40 US).
Tax Profits for Brazilian Government
Aside from generating money for the local economies and jobs within each state, a major reason to allow for the building of these resorts is the possible tax profit, which can highly benefit the Brazilian government at large by being distributed to various public projects.
It has already been decided that 5% of gaming revenue will be collected from all casino-resorts, with half of that amount given to the Municipal Participation Fund and about one third to the State Participation Fund. Local and state governments will then have their own allocations to spend.
The 20% left of the gaming revenue tax are earmarked for the promotion of tourism in Brazil. After a difficult time period with the COVID-19 pandemic and the concern of virus variants in the country, tourism could certainly use a boost within Brazil. The resorts and their promotion are one clear strategy to attract new visitors into the state, as well as those who have been unable to travel recently.
The new progress on casino-resorts is also noteworthy in Brazil, since up until quite recently, the country was fairly strict in prohibiting games of chance. It is only recently that Brazil has decided to legalize various forms of gambling, including sports betting, in an effort to regulate and profit from these popular pastimes.
The legislators working on this legalization also faced backlash from operators recently when they decided to move from a licensing-based model to a concession model. Many operators felt jilted after having invested a lot in developing proposals for new properties.
Still, all of these developments are surely exciting for gaming fans in the state, as well as for those tourists who would like to combine their travel in Brazil with betting. Brazilian President Jair Bolsonaro has been determined to get sports betting regulated as quickly as possible. Sports betting providers like Amuleto Bet are already getting into position within the country.
The federal government also recently approved some changes to their collection of taxes from gaming, which will now be based on gross gaming revenue as opposed to total turnover.
