The proposal will regulate the gaming sector in Brazil
Last Wednesday (13th) the Federal Senate approved the legal framework for electronic games. The text ended up undergoing some changes at the request of the federal government, without however eliminating the provision of tax breaks for builders in the area. With the changes, the proposal returns to the Chamber of Deputies to be analyzed again.
The project regulates the entire gaming industry in Brazil, including the production, import and sale of games. Measures are also taken to improve the business environment and increase the availability of capital for investment in the area.
One of the main innovations compared to the text of the Chamber of Deputies concerned a section dedicated to fantasy games, in which it is possible to assemble fictitious teams with players coming from a real competition. This method was excluded from the legislation. Slot machines, games of chance and lotteries were also excluded, as they are not considered games.
Taxes and tax benefits
Regarding the taxation of electronic games, the industry has long stated that the taxes cannot be the same as those applied to gambling, since they are different methods. The government then suggested the creation of specific taxation for this sector.
Subsequently it was preferred that the content of the project not be modified, but simply adjusted to make some of its points clearer.
The legal framework means that electronic games fall under the same tax rules as computer equipment, i.e. investments in the development or creation of them will be seen as investments in research, development and innovation (PDI). This way the sector will be able to take advantage of the IT law and obtain discounts on federal taxes for those who spend on PDI.
Second Brazilian agency, the text also provides tax breaks for the creators of electronic games. They will be entitled to a 70% reduction in income tax due on remittances abroad, which is part of the Audiovisual Law. This benefit also applies to taxpayers who invest in independent electronic game projects.
Furthermore, under the Lei do Bem, the development of electronic games is now classified as a technological research and innovation activity, which allows access to tax incentives, such as a 50% reduction in the tax on industrialized products ( IPI).
Source: Terra
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