In Brazil, President Luiz Inácio Lula da Silva has sanctioned a phased increase in taxation for gambling operators, a move that will see the tax rate rise to 15% by 2028. This decision follows the approval of Complementary Law No. 224, which was sanctioned last week after receiving consent from both the Senate and the Chamber of Deputies in December. The law will gradually elevate the tax on gross gaming revenue from the current 12% to 13% in 2026, 14% in 2027, and up to 15% by 2028. Furthermore, the legislation mandates that a portion of the revenue collected will be allocated to social security, beginning at 1% in 2026 and escalating to 3% by 2028. This change is significant in the context of Brazil’s regulatory framework and marks a concerted effort by the government to regulate and derive increased fiscal benefits from the gambling sector.
Complementary Law No. 224 not only affects tax rates but also introduces joint liability for entities promoting illegal betting platforms and financial institutions that engage with unlicensed operators. Although the law has largely come into effect with the New Year, the Brazilian constitution stipulates a 90-day delay for any new taxes, providing operators a brief window before the tax rate rises to 13%.
The 15% rate is notably less than the 18% proposed by the Senate’s Economic Affairs Committee in early December under PL 5,473/2025. The adoption of PLP 128/2025, which led to Complementary Law No. 224, reflects a strategic adjustment by the government to expedite the legislative process amid political debates that risked stalling progress before the parliamentary recess.
Despite the seemingly moderate final tax rate, operators remain concerned about potential additional taxation on player deposits, which could further impact their operations. In December, the Senate plenary approved a 15% tax on deposits made to licensed gambling platforms. However, amendments to the bill necessitate its return to the Chamber of Deputies for further review before potential presidential approval. The expected revenue from this CIDE-Bets tax is intended for the National Public Security Fund and could generate approximately BRL 30 billion ($5.5 billion) annually.
Moreover, the Antifaction Bill has reintroduced the RERCT Litígio Zero Bets mechanism, which obligates operators to retrospectively pay a 15% tax on gambling activities conducted between 2018 and 2024, predating the official regulation of the gambling market in January 2025.
Industry observers, such as Udo Seckelmann from Brazilian law firm Bichara e Motta Advogados, have expressed concerns regarding the potential impact of the CIDE-Bets tax. He warned that it could reduce the channeling of gambling activities to licensed platforms to below 20%, posing a risk to the regulated market’s stability and growth.
As the phased tax increases unfold, operators and stakeholders within the Brazilian gambling sector will be closely monitoring the implications of these regulatory changes. The timeline for the implementation of these tax measures and the potential introduction of additional levies will be critical in shaping the market’s future landscape. The industry anticipates further developments as legislative processes continue, with the outcome likely impacting both operators’ strategies and the broader economic contributions of the gambling sector in Brazil.
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