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Brazil’s betting and iGaming operators are facing a higher tax bill after a key Senate committee approved a plan to lift the gross gaming revenue (GGR) rate from 12% to 18% over the next three years.
On Tuesday, the Senate’s Economic Affairs Committee (CAE) endorsed Bill PL 5.473/2025 by 23 votes to one, backing a staged increase in the federal levy on licensed fixed-odds betting and online gaming. The proposal now moves to the Chamber of Deputies for further debate before any final vote.
How the new tax ladder would work
Under the current rules set by Law 14.790/2023, licensed operators are required to pay 12% of their gross gaming revenue to the federal government, in addition to corporate income tax, social contributions, and other applicable charges. Under PL 5.473/2025, that headline rate would rise in stages, reaching 15% in 2026 and 2027, then 18% from 2028 onwards.
The contribution is calculated on GGR, meaning total stakes received minus prizes paid to players, and the additional take is earmarked for Brazil’s social security budget, with priority given to health spending.
Between 2026 and 2028, the federal government would also have the option to redirect part of this extra revenue to states, the Federal District, or municipalities.
The version passed on Tuesday seeks a ‘middle-ground’ from the 24% shock proposal
The original draft of PL 5.473/2025 proposed to double the betting tax from 12% to 24% of GGR in a single jump.
This triggered much criticism from operators and consultants. Brazilian iGaming analyst Elvis Lourenço called the 24% idea “insane” and warned ithat t could “collapse the market” by pushing players back to unlicensed sites and werasingmargins for compliant brands.
Rapporteur Senator Eduardo Braga (MDB–AM) reworked the bill in committee, replacing the 24% figure with the gradual 15–18% path. He argued that a sharp hike would punish licensed firms while leaving illegal operators untouched.
“Our concern is that a sudden doubling of the rate would damage companies that chose to enter the legal framework, while irregular operators would continue to act with impunity and pay nothing into the public coffers,” Braga told colleagues as he defended the amended text.
Senator Renan Calheiros (MDB–AL), the bill’s author, backed the compromise, saying it was a way to increase social funding without breaking the newly regulated market.
Tax rise tied to Lula’s fiscal push
The ongoing gambling tax debate is more about athe broaderfiscal bcontext President Lula’s administration is under pressure to meet ambitious deficit targets and has repeatedly turned to the fast-growing betting sector as a source of additional revenue.
A previous attempt to lraisethe GGR rate vthrougha provisional measure and a separate bill rencounteredresistance in Congress earlier this year. Lawmakers allowed one proposal to lapse without a vote, forcing Finance Minister Fernando Haddad back to the drawing board on a broader package of tax measures.
The Ministry of Finance has indicated that higher taxes on betting and fintech firms, combined, could generate up to BRL 18b billionin extra revenue between 2026 and 2028, with gambling accounting for a sportionof that total.
At the same time, October data showed the first noticeable month-on-month drop in betting tax receipts since Brazil’s regulated market opened in January 2025, with collections slipping 9.4% from September to BRL 1.09bn. That wobble has sharpened the debate over how far the government can push the sector without undermining long-term growth.
Industry warns of cumulative burden
While operators and advisers stress that the GGR levy is only one piece of the tax stack in Brazil, Lourenço has repeatedly argued that once all layers are ctaken into account Brazil’s effective pressure on regulated operators already sranksin the upper tier globally.
In comments to several trade publications, he has suggested that a long-term GGR range of 15–18% is “realistic”, but only if the government resists further attempts to pile additional levies on the same base.
Trade groups and local licensees also warn that higher taxes could limit the ability of regulated books to compete with offshore sites on odds, bonuses, and product investment, undermining channelisation – the share of betting that flows through the licensed market instead of the black market.
Fintechs and payments aare lso in the crosshairs
The same PL 5.473/2025 raises social contribution rates (CSLL) for payment institutions, credit fintechs, and other financial firms that are closely tied to betting payments.
From 2026, payment institutions would see CSLL rise from 9% to 12%, before moving to 15% in 2028. Credit and investment fintechs would shift from 15% to 17.5%, then to 20%, on the same timeline. Banks, which already pay 20%, keep their current rate.
That means some of the key processing partners for sportsbooks and casinos will also be carrying a heavier tax load,. This factorcould finfluenceservice pricing and, ultimately, iimpactoperators’ cost base.
What happens next
With CAE approval secured, the bill now heads to the Chamber of Deputies, where it will be assigned to the relevant committees and then to a floor vote. If deputies modify the text, it must rbe returnedto the Senate; if they approve it as is, it goes sdirectlyto the president for sanction or veto.
Source: iGaming Business
