Regis Dudena, head of the Secretariat of Prizes and Bets (SPA), announced in April that betting using social welfare funds from programs like Bolsa Família, which aids approximately 50 million individuals in Brazil, would be prohibited.
It is anticipated that this action will undergo legal scrutiny, as the SPA plans to release a formal decree to enforce the ban.
Nonetheless, Luiz Felipe Maia, a founding partner at the Brazilian law firm Maia Yoshiyasu Advogados, cautions that the ban may violate the rights of Brazilians.
Felipe Maia expressed to iGB: “In essence, this is a matter of civil liberties because the argument is, ‘If I am dependent on welfare, I lose the right to choose where my money goes, limiting my freedom’.
“You either provide vouchers for specific items like food, dictating their use, or you give them money and allow them to make their own spending decisions.”
How does betting differ from alcohol and tobacco?
Earlier this year, betting was included in tax reform discussions in Brazil, with the industry expecting a future consumption tax, often referred to as a “sin tax”.
Although these proposals have been set aside for now, Felipe Maia believes that banning betting with Bolsa Família could negatively impact the perception of gambling, especially when similar restrictions are not imposed on equally addictive habits like smoking and drinking.
“Regarding welfare, I have not seen objections to beneficiaries spending on beer or cigarettes,” Felipe Maia remarked. “So, what sets betting apart?
“While I acknowledge these benefits are not intended for gaming, it is equally concerning if they are used for alcohol or cigarettes. Considering gambling is a form of entertainment, should spending on movies or Netflix also be restricted?”
Banning Bolsa Família could boost the black market
Last September, the Central Bank of Brazil disclosed that approximately a fifth of the Bolsa Família funds were used for online gambling.
Ed Birkin, the managing director of H2 Gambling Capital, believes that while the ban on betting with Bolsa Família is well-intentioned, it may inadvertently steer players towards the unregulated market, where player safeguards are lacking.
“Some may argue that individuals should spend their benefits as they see fit,” Birkin remarked. “But if benefits are provided for a specific purpose, that should be respected.
“Attempting to prevent betting, unless they can significantly restrict spending – specifying that it cannot be with legal operators – will only drive them to illegal options.”
