Brazil’s Ministry of Finance has officially published a new Provisional Measure to increase the tax rate on online betting gross gaming revenue (GGR) by half from 12% to 18%.
The drastic decision has been taken as the Brazilian Government seeks to find an alternative means to boost the country’s economy, after a previously proposed hike in the Financial Transactions Tax (IOF) was shelved amid fears of reduced investor confidence.
Provisional Measure No. 1303/2025, published in the Federal Official Gazette, amends Law No. 13,756/2018 and establishes that 82% of the revenue will be allocated to cover the operating and maintenance expenses of the fixed-odds betting lottery operator and other games, resulting in a new effective tax rate of 18%.
The measure came into effect yesterday (11 June) and is valid for 60 days, but it can be extended for another 60 days. The measure will now be considered by the National Congress and, if approved, it will be enacted and converted into law.
The committee’s report will then be voted on, and if approved without changes, it will be enacted and converted into law.
As operators contend with the prospect of the new financial burden, some within Brazil’s Government have suggested this could be just the beginning of the changes.
During the opening of the National Supply Chain Forum, Brazil’s Vice President of the Republic and Minister of Development, Geraldo Alckmin, suggested that the tax increase on GGR could be even higher.
He told attendees at the event: “I like your proposal. Not just the 18% that the government is proposing, but 27%. This will help prevent many families and society as a whole from being harmed.
“The Government’s proposal is to raise it to 18%, but we can work with Congress to go even further.”
IBJR threatens legal action
Upon the announcement of the changes, the Brazilian Institute for Responsible Gaming (IBJR) expressed “strong indignation” through a statement published on its social media.
“The measure is unacceptable and makes the operation of many companies — which trusted and invested in the regulated market — unfeasible, creates legal uncertainty, and threatens public revenue,” the statement said.
Operators paid R$30m (£4m) for a five-year licence in the newly-regulated market, based on a 12% tax rate and, the IBJR noted, changing this rate mid-contract “compromises the economic-financial balance and trust in the regulatory environment”.
The statement continued: “By increasing the tax on betting, the illegal market is likely to grow from the current 50% to at least 60%, resulting in an estimated loss of more than R$2 billion per year in revenue. The path to increasing revenue is not to penalise those operating legally, but to rigorously combat illegality and protect bettors by following the sector’s regulations.
“In light of this violation, IBJR will pursue all avenues to defend the regulated market, including legal action.”
