Brazilian government expected to raise R$ 1.8 billion through betting taxation
The sports betting and online gaming market in Brazil has experienced massive growth in recent years, which has had an impact on various economic and social aspects. With the regulation implemented by the Secretariat of Prizes and Betting (SPA) of the Ministry of Finance, the federal government is expected to raise up to R$ 1.866 billion annually through the supervisory fee applied to fixed-odds betting companies, known as “bets.”
Taxation structure and expected revenue
The regulation establishes eight payment bands for the supervisory fee, determined based on the companies’ monthly revenue. Companies with monthly revenues of up to R$ 30.8 million are subject to the lowest tax rate. In comparison, those with revenues exceeding R$ 660.96 million will have to pay the maximum rate. The monthly amounts collected range from approximately R$ 54,000 to R$ 1.9 million. Based on the number of legally operating companies in Brazil, estimated at 80 legal entities, the government’s monthly revenue from these fees could range from R$ 4.353 million to R$ 155.52 million. Annually, this represents revenue between R$ 52.2 million and R$ 1.866 billion.
Growth of the sports betting market in Brazil
Over the past five years, sports betting has grown at a rapid pace in Brazil, even while still undergoing regulation. It already accounts for a significant portion of lower-income groups’ expenditures—equivalent to 76% of these groups’ spending on leisure and culture or 5% of what they spend on food. Data collected by Datahub recorded a 135% growth in the sector over 12 months, from August 2022 to August 2023. In 2023, Brazilians spent a total of R$ 68.2 billion on online betting, excluding winnings received by bettors. This amount equates to approximately 0.22% of the country’s Gross Domestic Product (GDP).
Who are the Brazilian bettors?
A DataSenado survey revealed that 12% of Brazilians reported having placed some type of sports bet in the past 30 days. Among Brazilians who placed bets, the majority claimed to have spent up to R$ 500 on apps or websites. Only 3% stated they had spent a higher amount. Interest in betting has increased 14 times over the past 10 years, according to Google Trends data. Nearly one-third (30%) of Brazilians aged 16 to 24 claim to have placed bets, double the national average of 15%.
Economic and social impact
The growth of online betting companies in Brazil directly impacts household consumption and income. The ease of access and the promise of quick gains attract a large number of Brazilians, who have already spent around R$ 68 billion on virtual games. Experts warn that these games do not provide significant returns in terms of employment and income generation, potentially compromising portions of family budgets that could be allocated to productive sectors of the economy. There are also concerns about the impact on household finances, mental health, and the country’s economy, particularly due to gambling addiction.
The regulation of the betting market was created with the aim of increasing government revenue and reducing the social problems associated with gambling, such as over-indebtedness and addiction. To achieve this, control measures have been implemented, including financial monitoring and betting limits. Companies are required to gradually provide betting data to the government for analysis and oversight. The government has also taken actions to combat illegal betting websites so that only companies duly authorised by the SPA are allowed to operate legally in Brazil, ensuring greater consumer security and market integrity.
With the regulation in place, the Brazilian betting market is expected to align with more mature markets, such as those in Europe, where sports betting follows strict control standards. The expectation is that regulation will bring greater transparency and security for consumers, in addition to contributing to federal revenue. However, it is also essential that the government continues to monitor the social impact of betting and implements effective public policies to prevent and address gambling addiction-related issues. Financial education and awareness campaigns about the risks associated with betting are crucial to minimising the negative effects of this expanding market.
This article was first published in Portuguese on 24 March 2025.
