The inclusion of bets in the Selective Tax is questioned by José Luís Ribeiro Brazuna, a partner at the law firm Bratax. According to him, no lottery modality other than sports betting is obligated to transfer part of the revenue to health. "It seems at least contradictory to want to subject it to an additional levy," evaluates the expert in an article in Jota.
Among the various topics discussed in the voting of PLP 68/2024, which will implement the tax reform of Constitutional Amendment 132/2023, the idea of subjecting betting companies to the payment of the selective tax (IS), colloquially called the "sin" tax, stands out.
The motivation rests on the alleged damages to mental health that would be caused by the activity.
All this occurs, coincidentally or not, amid the spread of news about the impact of bets on the economically most vulnerable segment of the population. And, hastily, before there is full regulation of the sector by the Secretary of Prizes and Bets, which should be concluded by next December 31.
Despite the variables already put on the table in this discussion, there are strictly legal elements that, in our view, should be the subject of some reflection, in order to avoid moving towards a taxation later questioned before the courts.
It is necessary to remember that gambling has been prohibited by the law of criminal misdemeanors for over 80 years. Nothing has changed here.
The companies commonly called betting companies actually operate the lottery activity, specifically in its "fixed quota betting lottery" modality.
This is a lawful activity regulated by Law 13.756/2018, along with the federal lottery, the specific prognosis lottery, the sports prognosis lottery, and the exclusive instant lottery (Lotex).
More than that, it is a public service (article 29), the responsibility not only of the Union, but also of the states and the Federal District (article 35-A), provided by the private sector under authorization and in a competitive environment (article 4, of Law 14.790/2023).
All lottery modalities belong to the "prognosis contest" genre, thus being subject to a 12% taxation as a specific contribution to social security provided in article 195, inc. III, of the Constitution. Such contribution has a distribution among different entities and purposes, depending on the type of lottery.
In all cases, there is a partial allocation of the contribution to the National Public Security Fund. Excluding the federal lottery, all others revert part of the contribution to the Ministry of Sports. There is also a provision for distribution to culture, the national penitentiary fund, sports confederations, Ministry of Tourism, and even to the Red Cross.
Curiously, however, it is only the fixed quota betting lotteries, i.e., the bets, that are obliged to transfer part of their revenue to the Ministry of Health, precisely for the prevention, control, and mitigation of social damages arising from gaming. No other lottery modality has this obligation.
Besides being a public service, therefore, the revenue from lottery activities is partially "earmarked," being linked to these governmental and extragovernmental transfers, contributing to the funding of public policies in the areas of culture, public safety, sports, tourism, and education.
Does it make sense, therefore, to subject the provision of a public service to the "sin" tax? Is it reasonable to burden more heavily an activity that collects resources directly allocated to various state provisions, including health itself? And this through a tax that, unlike the revenue generated by the bets, will not have a specific destination for the treatment of the mental health of the bettors?
Moreover, if we are talking about a public service of the responsibility of the Union, the states, and the municipalities, even if provided under authorization, would it be possible to charge tax on this activity when the Constitution, in its article 150, inc. VI, letter "a", provides for reciprocal immunity over the patrimony, income, and state services? Let's remember that the Supreme Court has already declared the state lottery of Minas Gerais protected by the said reciprocal immunity.
It is true that article 150, § 3º, excludes from this protection the "economic activities governed by the norms applicable to private enterprises".
Still, the STF collects decisions immunizing all services provided by the Post Office (not only the postal activity), the consulting and advisory activities of Infraero (not only the administration, operation, and exploitation of airport infrastructure) and even the manufacture of telephone chips and printing of stamps by the Mint (not only the issuance of currency).
In other precedents, it is true, the court adopted a more restrictive understanding, excluding from immunity activities capable of manifesting wealth in favor of the private sector, even though at the same time they generated benefits for the Public Power.
In the case of lotteries, regardless of any consideration around proportions, the generation of mutual benefits – for the private sector and for the State – is unquestionable. Hence, even though it may sound exaggerated to suggest immunity for the lottery activity, it seems at least contradictory to want to subject it to the additional levy of the selective tax.
José Luís Ribeiro Brazuna
Professor at IBDT, Master in Tax Law from the Faculty of Law of USP and founder of Bratax (Brazuna, Ruschmann and Soriano Law Firm)
