Human rights campaigners have sounded the alarm about proposed Brazilian anti-terrorism legislation that they fear will be used to crack down on legal protests during the World Cup.

The government says that it needs the new law before the tournament, which kicks off on 12 June, because the high-profile international event could be a target for violent extremists. But lawyers, politicians, NGOs and protest organisers warn that the current wording of a bill submitted to the Brazilian National Congress is dangerously vague and could allow security forces unprecedented powers to arrest demonstrators.

Brazil currently has no anti-terrorism laws, partly because – like many nations in South America – people remember how such legislation was abused during the dictatorship era, which ended in 1985.

Congress, though, is now considering Bill 449, which would create a penalty of 15 to 30 years in prison for "causing or inciting widespread terror by threatening or trying to threaten the life, the physical integrity or the health or liberty of a person".

Advocates of the new law say it is necessary measure to fill a gap in the legal system. Although Brazil has had no major terrorist incident for many years, they say the country must be prepared because of its growing international profile and is acting as host to foreign sports fans, teams and dignitaries.

In addition, several states that will host matches have called for new powers to forestall or break up violent protests and to outlaw the wearing of masks such as those used by Black Bloc extremists. This follows street rallies by more than a million people during the Confederations Cup last year and subsequent smaller, more violent demonstrations.

Critics warn that the two challenges – terrorism and protest – are at risk of being conflated as the government attempts to push World Cup-related legislation through congress.

Humberto Costa, leader of the Workers' party in the Senate, says an anti-terrorism bill is needed, but the bill now under discussion has failed to define exactly the crime of terrorism. "On the contrary, it has created a kind of open penalty with which the state is able to arbitrarily criminalise a considerable number of activities, including social protest," he said.

Amnesty International says the draft legislation could worsen the already dire record of Brazil's police in dealing with public unrest and "puts freedom of expression and the right to peaceful assembly at risk".

João Tancredo, president of the lawyers' group, the Institute of Defenders of Human Rights, said the law in its current form was a step backwards because it could frame protesters. "It's not healthy for a country that intends to have a just democracy to have laws like this," he said. "You can't compare a protester to a terrorist. It's irresponsible. This is something that not even the dictatorship did."

President Dilma Rousseff, who must sign any bill into law, is on the horns of a dilemma. As a former guerrilla tortured during the dictatorship, she has experience of the dangers posed by an overly powerful security apparatus. But she has also promised Fifa she will minimise the risk of disturbances during the World Cup and needs a smoothly run tournament to boost her chances of re-election during presidential polls in October.

The authorities have beefed up security and launched a major marketing campaign to minimise the likelihood of mass protests during the World Cup and to prevent a repeat of the looting and vandalism carried out by an anarchist fringe of demonstrators. The elite national security force has told local media that 10,000 anti-riot police will be deployed in the 12 cities involved. The Brazilian intelligence agency has also stepped up surveillance of Facebook and other social networks that are used to organise protests.

Although the force of the law has increased, the authorities say the likely scale of the protests will be reduced compared with last year. The government has promised more spending on healthcare and education. Violence also appears to have deterred many would-be protesters. A poll found that support for the protests fell from 81% in June to 52% in February, while only 32% said they would back demonstrations during the World Cup.

Rio de Janeiro's under-secretary of major events, Roberto Alzir, said that the authorities did not expect the same intensity of protests as during the Confederations Cup, but were ready for all scenarios.

"At major events in all countries, some groups try to take advantage of the visibility to publicise their causes. The authorities have prepared for this and will make every effort to ensure that such events occur in a peaceful and orderly manner, but without prejudice to the event."

The framers of the new anti-terror bill say the wording will be redrafted to clear up ambiguities, but some protesters say this will make no difference to police abusing their powers.

"This already happens without this law. It's clear this is just one more plan of this system. It's all a façade. The truth is they don't want any protests," a Black Bloc member responded from the group's Facebook account.

"We're not going to accept rules from these corrupt people and they certainly know that."