Zona de Azar Brasil – Brazil Porto Alegre: Tax Reduction Strategy for the iGaming Market

Brazil.- December 19, 2024 www.zonadeazar.com  The Porto Alegre City Council (RS) approved an amendment to reduce the ISSQN (Service Tax on Any Nature) rate from 5% to 2% until 2036. The measure includes services such as sports betting, lotteries, bingo, and prize draws.

According to the government of Mayor Sebastião Melo (MDB), the tax reduction aims to attract companies in the betting sector, which has been rapidly growing since its regulation in 2023.

Tax Incentive Aims to Boost the Local Economy

“With the tax reduction, Porto Alegre aims to position itself as a hub for the sector, which promises to generate jobs, stimulate the local economy, and increase tax revenues. This activity joins 62 others for which we had already reduced the tax,” explained Rodrigo Fantinel, Secretary of Finance.

The bill incorporated the proposal by Councilman Cláudio Janta. Additionally, it extended the ISS exemption for public bus and selective shuttle transportation until 2026. Initially, the exemption was set to end in 2024.

Public Transportation Also Benefits

The City Council justified that the ISSQN exemption for collective bus transportation is a historic policy to control fare costs for citizens. In 2022, they introduced the exemption for shuttle transportation to lower fares, attract more passengers, and improve urban mobility.

“The ISSQN exemption is a historic measure to reduce costs and improve public access to transportation,” highlighted the City Council.

New Momentum for the Sports Betting Sector

With the regulation of sports betting, Brazil is experiencing a new phase in the iGaming market. The approved measure seeks to take advantage of the favorable moment while aligning Porto Alegre with other cities that have already adopted incentives to attract companies in this sector.

The proposal now awaits the approval of Mayor Sebastião Melo. If sanctioned, the capital of Rio Grande do Sul is expected to consolidate its position as one of the main iGaming hubs in the country. This will undoubtedly have a direct impact on the job market and municipal revenues.

Edited by: @_fonta
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