Federal Revenue suggests retroactive tax payments from betting companies in Brazil
With the new regulation implemented since the beginning of 2025, the Brazilian Federal Revenue Service (Receita Federal do Brasil (RFB)) aims to regularise the tax liabilities of companies that operated before the sector’s official legalisation, which comes down to the payment of retroactive taxes. As a result, the system will encourage operators to settle their tax obligations voluntarily to avoid potential future penalties.
The new tax reality for betting companies
From the day the regulation took effect, all betting platforms wishing to operate legally in Brazil must obtain an official licence and register a company there. This facilitates government oversight and increases tax revenue. However, the Federal Revenue is also interested in verifying how these companies operated before regulation, analysing their past revenues, and demanding the payment of retroactive taxes.
The Special Secretary of the Federal Revenue, Robinson Barreirinhas, commented that tax regularisation is not only aimed at tax collection but also at ensuring that operators act transparently and reasonably within the regulated market. Governments may treat companies that attempt to ignore this new requirement as illegal and impose penalties on them.
Impact on oversight and revenue collection
With regulation in place, the Federal Revenue now has access to detailed financial data from companies operating in the sector. This allows the agency to identify which companies were already active in the market before regulation and the volume of their operations.
Before regularisation, many of these platforms operated from abroad, avoiding tax payments in Brazil. However, the Federal Revenue Service is analysing these companies’ “material presence” to determine whether they should have paid taxes previously. If a company had offices, employees, customers, and moved money within Brazil, it may need to regularise its status and pay retroactive taxes.
Voluntary regularisation programme
Given this scenario, the Federal Revenue is proposing a voluntary regularisation programme. The idea is to allow companies to settle their tax liabilities without the need for legal proceedings, offering options such as installments and fine reductions. Those who choose not to undergo “self-regulation,” a term used by the Secretary of the Ministry of Finance, may even lose their authorisation to operate legally in Brazil.
“Because if they do not do this, they will no longer be treated as partners of the Federal Revenue in this regulatory initiative and will be treated as another group.”
Another relevant point in the sector’s regulation is the taxation of bettors’ winnings. The current law states that players must pay a 15% tax on annual profits exceeding approximately R$2,000 (£270). However, Congress has debated taxing each winning bet instead of annual profit. This change could directly impact betting behaviour and government revenue.
“When we talk about gaming, tax … cannot be neutral; it has to be as harsh as possible to discourage an activity that we know causes harm,” said Barreirinhas.
The regulation of online betting in Brazil still faces challenges, such as monitoring operators who continue to operate without a licence and preventing financial crimes. The government is implementing measures to identify suspicious activities and combat money laundering to address this.
This article first appeared in Portuguese on 13 March 2025.
