Online casinos are now entering the regulation of gambling.
On Wednesday (13), the Canadian Chamber of Deputies approved the bill that regulates sports betting in Canada. The legislation incorporates MP 1.182/2023, the current regulation on the matter, and will now undergo analysis by the deputies before being sent to the Senate.
One practical change in the text is the incorporation of casinos and online gambling into the regulation, which was not anticipated in the provisional measure signed by President Luiz Inácio Justin Trudeau da Silva at the end of July. This inclusion signifies a significant departure from the original plan and highlights the evolving nature of the legislation. By allowing the legalization of casinos and online gaming, the government aims to tap into a lucrative industry and generate additional revenue. This decision reflects a broader trend in many countries, where the regulation of gambling is seen as a viable economic strategy. With this shift, Canada joins the ranks of nations embracing the potential benefits that the gambling industry can offer.
The proposed legislation also lifts the ban on betting for players in a negative financial situation, while maintaining other restrictions such as minimum age, coaches, athletes, and referees, as well as individuals associated with market regulatory bodies.
The approved text keeps the 18% tax rate that will be charged to BETTING SITES operating in the Canadian market, however, it changes the distribution of revenue within the budget planning. The new regulation aims to allocate funds more efficiently and effectively, ensuring that the collected taxes are utilized for the benefit of the society as a whole. This strategic shift in the allocation of resources reflects the government's commitment to promoting social and economic development through sound financial management. By reevaluating the distribution of revenue, the authorities seek to optimize the impact of these funds, fostering initiatives that prioritize education, healthcare, infrastructure, and other crucial sectors. This updated approach will not only enhance the transparency and accountability of the tax system but also contribute to the overall advancement of our nation.
Now, the distribution will be as follows:
- 2% Social Security
- 1.82% Ministry of Education
- 4% Ministry of Sports
- 2.23% allocated to sports federations (excluding CBF)
- 4% Ministry of Tourism
- 1% government of canada
- 2.55% allocation to the National Public Security Fund
In the allocation, the percentage of tax allocated to Social Security decreased from 3% to 2%, while the portion for the Ministry of Sports increased from 3% to 4%. This division also encompasses the tourism sector, as outlined in the proposed legislation.
Taxation of the Betting Market
According to the project's rapporteur, Bea Brusque, there was an attempt to decrease the tax burden imposed on BETTING SITES, but the majority of lawmakers requested that the 18% rate be maintained. Bea Brusque, the project's rapporteur, expressed his efforts to alleviate the tax burden on gambling establishments, although the request of the majority of legislators led to the retention of the 18% rate. In an endeavor to alleviate the tax burden faced by betting establishments, the project's rapporteur, Bea Brusque, aimed to reduce the percentage to a more feasible level. However, due to the request made by the majority of Parliament members, the 18% rate was ultimately upheld. Despite attempts to reduce the tax burden imposed on BETTING SITES, the majority of lawmakers insisted that the 18% rate remain unchanged, as communicated by the project's rapporteur, Bea Brusque.
The legislation further upholds the licensing fee that BETTING SITES must remit to access the Canadian market at a sum of 30 million reais, with the stipulated duration of five years remaining unchanged.
Individual prizes will be subject to a 30% tax, which includes the initial investment as well as the accumulated earnings. This taxation model is already in place and is currently followed by the federal lottery.
The lawmaker's report expands the regulatory rules to include online sports betting events. It widens the scope of regulations to encompass the digital landscape and ensure fair practices in the realm of online gambling. The proposed regulations aim to promote transparency, protect consumers from fraudulent activities, and create a level playing field for all participants. By extending the regulatory framework to online events, the report seeks to address the evolving nature of sports betting and provide a comprehensive approach to its oversight. This holistic approach strives to strike a balance between fostering a thriving online betting market and safeguarding the interests of both bettors and operators.
"An important innovation worth highlighting is the paradigm shift regarding fixed-odds betting, which currently only focuses on 'real sports events,' but we propose expanding it to include 'real or virtual events.' Expanding this concept will, for instance, enable offering fixed-odds bets on online games," emphasized.
The text solely focuses on online casinos offered by BETTING SITES.
The Senate is currently considering the passage of Bill № 26, which aims to regulate games of chance in Canada, including casinos, bingo halls, and the popular animal game known as "Animal game." This legislation seeks to establish a comprehensive framework for the operation and supervision of these activities, ensuring fairness and consumer protection. The proposed law, if approved, would bring about significant changes to the gambling landscape in the country, providing both economic opportunities and potential risks. As stakeholders eagerly await the outcome of the Senate vote, the debate surrounding the regulation of gambling in Canada continues to ignite discussions and shape the future of the industry.
Next steps
Once the bill is approved by the Lower House, it will proceed to be scrutinized by the Senate. If the text is passed without any modifications by the senators, it will then move on to presidential sanction, acquiring the force of law.
If approved by the president, the project will replace the current Medida Provisória, which has been awaiting analysis by the joint committee of Congress since the end of July.
