Brazilian government prepares 18% tax for online gambling operators from October 2025

• The Brazilian government issued a Provisional Measure in June 2025 to increase the Gross Gaming Revenue tax rate from 12% to 18%, effective 1 October 2025, pending congressional approval
• The tax increase comes as Brazil’s regulated online gambling market generates over R$120 billion in 2025, with operators already facing R$30 million licensing fees and additional compliance costs
• Industry leaders express concerns over market stability as the sector adapts to evolving regulations eight months after the official launch of Brazil’s legal betting framework

The tax increase comes as Brazil’s regulated online gambling market demonstrates substantial growth eight months after its official launch on 1 January 2025.

The market is projected to reach R$120 billion in 2025, with expectations of generating R$20 billion in additional taxes and fees for the government. This robust performance has attracted government attention as authorities seek to maximise revenue from the sector.

Existing financial burden

The proposed tax increase compounds existing financial obligations for operators in Brazil’s regulated market. Companies currently pay R$30 million (approximately $6 million USD) for five-year licences, in addition to the existing 12% GGR tax rate and standard corporate taxes.

The Secretariat of Prizes and Bets (SPA) has issued 68 licences to operators, including international giants like Bet365 and Betsson alongside local players.

Players also face taxation, with a 15% personal income tax applied to winnings exceeding R$2,824 (approximately $547.25). The comprehensive tax framework demonstrates the government’s commitment to generating substantial revenue from the newly regulated sector.

Compliance challenges

The regulated market has required operators to implement extensive compliance measures beyond taxation. Financial oversight intensified in March 2025 when the SPA enacted Ordinance No. 566, requiring financial institutions and payment providers to monitor, report, and block transactions associated with unlicensed betting operators. Non-compliance may result in sanctions and legal consequences.

Operators must also navigate strict advertising restrictions implemented through Normative Ordinance No 1,902, which focuses on preventing advertisements targeting minors and ensuring age restriction compliance.

The Brazilian Council for Self-Regulation in Advertising established specific guidelines through Annex “X,” which took effect on 29 January 2024.

Market consolidation

Industry observers predict significant consolidation as operators adjust to the evolving regulatory landscape.

The market launched with 14 full online betting licences granted on day one, with over 50 companies receiving provisional licences as they complete technical certifications. International operators including Bet365 and Betsson compete alongside domestic players such as Aposta Ganha and Rei do Pitaco.

The Ministry of Finance published its regulatory agenda for betting and gambling through 2026, outlining 13 initiatives to be implemented over the coming period. These developments occur as Brazil’s emergence as a regulated market represents one of the most significant developments in the international iGaming sector, with over 215 million inhabitants and accounting for 21% of global online gambling traffic.

As the October deadline approaches for the tax increase implementation, operators must balance compliance costs with market competitiveness in Latin America’s largest gambling jurisdiction.

The outcome of congressional deliberations on the Provisional Measure will determine whether the 18% GGR tax rate becomes permanent, potentially reshaping the sector’s financial dynamics for years to come.