Operators in Brazil could be subject to further taxes in the newly regulated iGaming market, after an ordinance proposing the establishment of ‘GTI Bets’ listed one of their responsibilities as imposing retroactive taxes.
Ordinance RFB/SPA/MF No. 3/2025, produced jointly by the Prizes and Betting Secretariat of the Ministry of Finance (SPA/MF) and the Federal Revenue Service (FRS) and published in the Official Gazette of the Union, seeks to establish the Intersecretarial Working Group (GTI), named GTI Bets.
GTI Bets will be tasked with monitoring the compliance of online gambling licences, identifying illegal activities for SPA, as well as analysing potential tax liabilities of operators for the FRS.
The ordinance also says in Article 1 Item II that GTI Bets would also be utilised to “subsidise a proposal for a compliance program to regularise tax obligations in relation to a period prior to authorisation, for authorised legal entities”.
Ricardo Assis, Editor of SBC Noticias Brasil, has consulted with legal experts – Filipe Rodrigues, Lawyer and CEO of Jogo Positivo and Andréa Ueda, Associate Lawyer at AMIG Brazil – to analyse GTI Bets’ duties and if retroactive taxes on licenced operators from before the Brazilian market’s official launch on 1 January 2025 can be imposed.
Rodrigues stated that the item doesn’t clarify if tax obligations related to the period before authorisation are “primary or accessory”. The Jogo Positivo CEO noted: “While the primary obligation is directly related to the payment of tax, the accessory obligation is focused on the actions and procedures that ensure the correct assessment, inspection and control of taxes.”
For retroactive taxes to be implemented, Rodrigues emphasised that operators can’t be penalised for failing to comply with laws that were not in place at the time.
“With all due respect to other opinions, I understand that there is no past principal tax obligation. This would be an abuse of state power. The principle of tax legality establishes a limit to the State’s power to tax, ensuring that taxes can only be collected when there is an express legal provision to do so.
“This means that no tax can be required without a law establishing it. Furthermore, the law establishing the tax must be clear and precise, in order to guarantee legal certainty and the predictability of tax obligations.
“In other words, the purpose of the principle of tax legality is to ensure tax justice and the protection of the taxpayer’s fundamental rights, while allowing the State to collect the resources necessary to fulfil its functions and responsibilities.
“Therefore, any tax collection prior to the authorisation period would be arbitrary and illegal. Individuals cannot be punished for the State’s omission over the last six years,” concluded Rodrigues.
Ueda noted that the retroactive tax proposal isn’t surprising since the topic has already been raised in previous conversations between association members and has been the subject of talks by politicians. However, the Associate Lawyer also highlighted the issues it could cause.
Ueda said: “Based on these premises of studies and desires or regulatory tax intentions (which are not, per se, undue) to simply say that it is feasible to collect possible taxes in the past, a huge gap opens up, where I highlight the arsenal of principles of Constitutional and Tax Law, which must be well mapped and studied, versus the facts and activities that occurred in the past, for the simple fact that, as any Law student knows, there are minimum prescriptive issues, of legal existence of the tax base at the time of the facts and active and passive legitimacy, which, certainly, is what will be the agenda of this GTI for the purposes of the device in question.
“I am not a tax specialist and, of course, I know that there are numerous legal opinions on the subject that have been drafted for some time, but as a citizen, what matters most on this subject is that there is transparency in these studies, the possibility of discussions with authorised operators and, above all, respect for the legal and regulatory frameworks that exist at the time, so that we maintain the legal security that is for the protection of society and the Rule of Law.”
The GTI Bets will take place over six months, a period which the Secretariats can choose to extend if they wish. Bimonthly reports and a conclusive report will also be presented.
