Against government guidance, Senate extends Sports Incentive Law

The Senate approved, this Wednesday (13), the extension of the Sports Incentive Law, contradicting an orientation of the federal government so that the text was not appreciated by the House. Created in 2006, the law was scheduled to expire on December 31 of this year, but there was an extension to 2027.

The text was approved in a symbolic vote and, now, goes to the sanction of President Jair Bolsonaro (PL).

The proposal had public support from allies of Jair Bolsonaro (PL), such as senators Romário (PL-RJ) —who was rapporteur on the issue at the Sports Commission— and Carlos Portinho (PL-RJ) —government leader in the House— and federal deputy Luiz Lima (PL-RJ), who promoted the issue in the Chamber.

However, there was resistance from the Ministry of Economy, which even issued a technical note to which the Sheet had access. In it, he advised politicians against approving the law, a fact that caused unease among government supporters who defend the incentive.

With the drop in the Sports budget, which in 2019 went from a Ministry to a Special Secretariat, the Incentive Law gained greater importance for the promotion of the sector. Since it was created, the mechanism has already allocated more than R$ 5 billion to the area and, in 2021, it broke an annual record, reaching almost R$ 450 million.

To press for the approval of the law before the congressional recess, which will begin next Monday (18), Atletas Pelo Brasil (an NGO that represents sportsmen) took to Brasília names such as Raí, idol of São Paulo and former president of the entity, and Ana Moser, current president and bronze medalist in volleyball in Atlanta-1996.

People connected to the sport feared that, if the proposal was not appreciated before the recess, there would be neither time nor climate to deliberate on it. Therefore, they argued that it was important that the agenda be voted on this week.

The approved text, in addition to extending the validity of the law, increases the tax deduction limit for legal entities and individuals, from 1% to 2% and from 6% to 7%, respectively. It also increases the list of companies able to donate money, adding those that pay taxes through the rules of presumed profit – more simplified.

As this last point conflicts with a 1997 law, there was an agreement for it to be condensed into a single provision, which should be vetoed by President Jair Bolsonaro (PL) when the matter is sanctioned by the Planalto.

This solution was built from meetings, which took place about a month ago, between representatives of the Economy and the Federal Revenue with the Department of Sports and with parliamentarians.

Senator Carlos Portinho (PL-RJ) received in his office, this Wednesday, representatives of the Ministry of Economy and parliamentarians to sew the renewal of the Sports Incentive Law.

It was agreed that the government will veto the part that grants tax incentives to legal entities taxed based on presumed profit.

“The government wants to renew the Incentive Law and it just needed some adjustments and some debates on the question of whether the legal entity with a presumptive profit can also have access to this benefit. The government cannot monitor precisely because profit is assumed. was maintained in the text, but with the commitment of both athletes and senators that the government will overturn this specific article”, said Carlos Portinho, in Plenary.

However, days before the bill was on the agenda at the Senate’s Committee on Economic Affairs (CAE), parliamentarians linked to the project received a technical note from the Economy against the renewal of the Incentive Law.

The document points out not only the problem of presumed profit but possible conflicts, for example, with the Fiscal Responsibility Law, due to the absence of financial impact studies.

“Given the technical and legal aspects exposed, the Ministry of Economy is against the approval of this bill”, says the text, which was sent by interlocutors to parliamentarians, as a government orientation on the subject.

When the matter was put to the vote at CAE last Wednesday (6), senator Eliane Nogueira (PP-PI), mother of the Civil House minister, Ciro Nogueira, even asked for a view of the project.

The idea was refuted by Romário and Esperidião Amin (PP-SC), a co-partisan of the senator, both from the government’s allied base. Eliane Nogueira ended up withdrawing her request.

The former player, according to people close to him, was irritated by the movements and the difficulty to advance a project that is the flag of a sector to which he is close.

The following day, Thursday (7), the president of the Special Secretariat for Sport, Marcelo Magalhães, was in the Chamber of Deputies along with several of his secretaries to reward the companies that raised the most funds through the Sports Incentive Law in 2021.

At the time, the possibility of its extinction was not considered – the atmosphere was that everything was aligned with the government for the renewal of the text.

THE Sheet contacted the Ministry of Economy and the Internal Revenue Service in search of a position on the subject and the technical note, but had no response.