Currently, the municipality applies a 5% tax rate to services provided by this segment. Mayor Álvaro Damião's proposal would reduce this percentage to 2%, the minimum permitted by law. The Municipal Finance Department expects the measure to generate a revenue reduction of R$11,685.34 (US$2,100) in 2025. This amount is considered low given the potential revenue from new taxpayers.
The Belo Horizonte City Hall estimates that ISS revenue could increase by R$2.8 million (US$504,000) in the first year, even with the reduced rate.
"With the significant increase in business conducted by virtual betting houses, known as 'bets,' and the advancement of national regulations, there is a clear movement of companies interested in establishing their activities in Brazil and becoming regular ISSQN taxpayers," the bill explains.
According to the city's survey, six companies in the sector have already expressed interest in operating in Belo Horizonte. According to the Executive, the measure follows the example of other cities such as São Paulo, Barueri, and Porto Alegre, which have already adopted similar tax strategies.
"Reducing the tax rate to 2% is a strategic measure to attract companies in the gambling sector to Belo Horizonte, aligning with the practices of other Brazilian municipalities seeking more competitive tax policies. In addition to mitigating the risk of losing economic opportunities to other locations, the proposal has the potential to generate an increase in future ISSQN revenue, while simultaneously stimulating the presence of new businesses in the city," the text states.
Source: GMB
