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The State Government of Rio Grande do Norte (RN), Brazil, has taken a resolute step to structure its state lottery business. The government issued Decree No. 34.927/2025 on September 24, 2025, in the Official State Gazette, which formally regulated the State Lottery Fund. The fund created by Law No. 12.217 earlier this year prescribes how revenue will be collected and distributed to different sectors of public policy, with a focus on social welfare, security, health, technology, sports, and housing.
Sources of Finance for the Lottery Fund
As per the decree, the fund shall be financed from diverse sources. The main sources of revenue shall include revenues from managing state lotteries and betting operations, as well as fiscal operations, budget funds, donations, and contracts. Of significant interest shall be the inclusion of unredeemed prizes on the lottery that are not redeemed within 90 days.
This diversified funding model aims to promote the stability of the lottery system and make consistent contributions to state development endeavors.
Priority Areas and Resource Allocation
The legislation stipulates seven prime areas to which resources will be allocated, and to each of these, a percentage will be allocated. The largest share, 40%, will be spent on the spread, organization, and upkeep of lottery services themselves, ensuring the functional capability of the system. The remainder goes straight to social and economic development:
- 18% for social security schemes.
- 13% for public security schemes.
- 13% for the development of public health.
- 8% for the development of sports.
- 4% for mass housing schemes.
- 4% for technology, innovation, and science.
The model seeks to balance effective operation with strong social impact, highlighting the government’s message that the lottery is not only an entertainment but also a funding vehicle for important services.
Governance and Oversight
To guarantee accountability, the decree establishes a Deliberative Council with the State Secretariat of Finance (Sefaz) at its head. The council will determine operating procedures and dictate investments. Members of the council are the State Secretary of Finance (president), Executive Secretary of Revenue (vice president), Coordinator of the State Lottery, Subcoordinator of Norms and Processes, and another member selected by the Secretary of Finance.
All financial transactions will be processed via a single bank account, which will be subject to federal reporting and auditing requirements.
Revenue Expectations and Economic Impact
The state foresees vast economic returns from the project. From an initial investment of R$3 million, the government anticipates a yearly revenue of approximately R$25 million, without the need to increase taxes. To Finance Secretary Carlos Eduardo Xavier, the project represents a new means of entertainment for the people and a secure source of revenues for the state.
Xavier emphasized that money will mostly be invested in housing and security, and, moreover, in health, science, and technology plans.
Legal Background and History
The action is grounded on a Supreme Federal Court (STF) ruling in 2020 that legalized states, municipalities, and the Federal District to provide and manage their own lotteries. Although Rio Grande do Norte established its lottery service in 2002, it was never actually put into practice until today.
With the decree, the state not only gets in sync with national legal practices but also awakens a sleeping initiative, transforming it into a development driver.
The state lottery fund regulation marks a new chapter in Rio Grande do Norte’s history. Combining fun with disciplined investment in the well-being of the populace, the state is putting its lottery both as an economic instrument and a policy instrument. If projections hold out, the fund can potentially take center stage in the construction of social infrastructure and ignite sustained expansion.
Source: iGaming Brasil
