Tax reform widens the fiscal gap between association-based clubs and SAFs (Sociedades Anônimas de Futebol - Football Corporations).

247 - The tax reform approved by Congress and signed into law with vetoes by President Lula (PT) structurally redefines tax collection in Brazilian football, establishing distinct regimes for associative clubs and Public Limited Football Companies (SAFs). The change creates a significant difference in tax rates between the two management models and reignites political and economic disputes behind the scenes in Brasília, with a direct impact on the financial and sporting stability of the teams, according to the newspaper. The Globe.

Under the new rules, associative clubs will be taxed at 15,5% on gross revenue, while SAFs (Sociedades Anônimas de Futebol - Football Corporations) will have a tax rate of 6%. The new regime will come into effect on January 1, 2027, and will have a transition period until 2032. Currently, sports associations are exempt from most taxes, paying basically 5% to INSS (Brazilian Social Security Institute) on revenues such as ticket sales. SAFs, on the other hand, pay a rate of 5% in the first five years of operation — already including Social Security — and 4% in subsequent years.

The difference of almost ten percentage points between the two models is seen by experts as a factor of imbalance. Economist César Grafietti, a specialist in football management and finance, believes that the asymmetry tends to directly favor the SAFs (Sociedades Anônimas de Futebol - Football Corporations). “There is a clear benefit. When you have a tax burden that is less than half of what the associations pay, it's a direct benefit. I think the biggest loser here is the associative club. From a sporting point of view, I think the ideal and correct thing would be to have equal tax rates,” he stated.

During the reform process, the initial text stipulated an 8,5% tax rate for SAFs (Sociedades Anônimas de Futebol, or Public Limited Companies). Clubs that adopted this corporate structure lobbied parliamentarians to reduce this percentage, with the participation of the Brazilian Football Confederation (CBF). This movement resulted in a reduction of the tax burden to 4% in the text approved by Congress. Simultaneously, leaders of associative clubs worked to try to equalize taxation between the two models.

In the final vote in the Chamber of Deputies, a last-minute drafting amendment was included to equalize the tax rates for associations and SAFs (Sociedades Anônimas de Futebol, or Football Corporations), following a request from parliamentarians linked to Flamengo. This provision and another article that reduced the taxation of SAFs to 4% were ultimately vetoed by President Lula, restoring the difference between the regimes.

With the tax disparity persisting, parliamentarians linked to association clubs have resumed their mobilization. Federal deputy Eduardo Bandeira de Mello (PSB-RJ), former president of Flamengo, reported having discussed the issue directly with the President of the Republic. “The conversation was brief, but he was receptive. I only informed him that this was happening, that there was this confusion,” he said. According to the deputy, there is still room for negotiation: “It’s a matter of evolving, negotiating, and reaching a solution that may even involve the executive branch.”

Federal deputy Julio Lopes (PL-RJ) stated that the group of parliamentarians linked to Flamengo should act to reverse the situation. “It was our attempt to make a proposal to equalize the SAF [Sociedade Anônima do Futebol, a type of football club structure]. We talked and managed to reach an agreement. Now, I can't say where or when, but I'm sure we'll get involved. And there are 150 of us Flamengo supporters there,” he declared.

In the Senate, Senator Carlos Portinho (PL-RJ), author of the SAFs Law, stated that the party intends to work to overturn the vetoes related to taxation. "We will work to overturn not only the SAFs, but also the associative clubs. That's what we worked on in the Chamber," he said.

The government's economic team maintains that equalizing tax regimes through a supplementary law is unconstitutional. João Nobre, advisor to the Executive Secretariat of the Ministry of Finance, argues that comparing tax rates does not necessarily reflect an advantage for one model over another. "It's not necessarily a more advantageous regime. I think this is very important to highlight, because the SAF (Sociedade Anônima do Futebol - Football Corporation) doesn't have tax credits, only for the buying and selling of players. So it's very case-by-case, depending on the club's revenues," he explained.

Since the creation of the SAFs Law in 2021, the model has been gaining ground in Brazilian football. A survey published by the Migalhas portal in August of last year indicates that 117 clubs have already been officially registered as Public Limited Football Companies. For Fabrício Costa Resende de Campos, a researcher at the Tax Studies Center of FGV Direito SP, tax policy reinforces this trend. “We observe that there is a normative economic incentive for the existence of SAFs. And it is a global trend that they are here to stay, with tax incentives, in addition to economic incentives from major market players,” he analyzed.

Currently, Botafogo, Cruzeiro, Bahia, Atlético-MG, and Vasco compete in Série A as SAFs (Sociedades Anônimas de Futebol, or Public Limited Companies). Flamengo, Fluminense, Palmeiras, São Paulo, Corinthians, and Santos remain structured as associative clubs. Red Bull Bragantino adopts a third format, that of a company-club, as provided for in the Zico Law of 1993.