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A bill now before the Brazilian Senate would exempt teachers from paying personal income tax, to be offset by taxation on fixed-odds betting companies. It represents a wider discussion of how revenues from the regulated betting sector might be channelled into meeting wider public policy objectives, in this case, education.
Income Tax Exemption for Teachers
The bill, filed under PL 5,143/2025 by Senator Fabiano Contarato, would provide an income tax exemption to education professionals earning up to R$10,000 per month. Included within the revenue exemption from IR are basic education and higher education teachers, provided that their revenues result from teaching activity only.
The measure, in implementation, would change Law No. 7,713 of 1988, the current rule on income tax exemptions and deductions. The text of the bill intends to lighten the tax burden on teachers without compromising fiscal balance, which will be guaranteed by an alternative source of revenue.
Funding Through Betting Taxation
Senator Contarato maintains that the fiscal impact of such an income tax exemption for teachers would remain relatively low. In order to offset any eventual loss in government revenues due to the exemption, the bill links the exemption directly to proceeds from the taxation of fixed-odds betting, known as “bets.”
This tax regime is due to Law No. 14,790 from 2023, which regulated and taxed the betting industry in Brazil. By setting apart a portion of this resource, the proposal intends not to affect fiscal responsibility negatively.
Rationale Behind the Proposal
In the justification of the bill, Contarato highlights the accumulated discrepancy in wages that Brazilian teachers have faced for years when compared to other professions with similar training and qualifications. According to the senator, despite efforts made by governments to raise the salaries of teachers, educators still receive lower wages compared to their colleagues in other careers.
According to the proposal, this discrepancy has directly impacted the fulfillment of the National Education Plan, which, through Law No. 13,005 of 2014, aimed at aligning teachers’ salaries with those of other professionals by 2024-a target that has not yet been fully achieved.
“The measure aims to value the teaching profession and encourage the retention of qualified professionals in early childhood, primary and secondary education, the structural foundation of the entire education system, as well as in higher education, which is responsible for the technical and scientific training of the country’s future professionals”, Contarato explained.
Legislative Status
The bill has been awaiting formal referral within the Senate since October 14, 2025. As the summary explains, the project proposes amending Law No. 7,713 to provide income tax exemption for teachers in basic and higher education for earnings of up to R$10,000 per month.
If passed, this could be a serious turnaround in the way Brazil distributes revenue from the betting industry, tying regulated gambling taxation directly with social and educational policy concerns.
Source: iGaming Brasil
