President Luiz Inácio Lula da Silva of Brazil is preparing to submit a provisional measure to Congress this week aimed at tightening regulations on betting within the country. CNN Brazil reports that the government is considering a range of new restrictions on betting advertisements while potentially banning online casino games altogether, with an intention to limit operations to sports betting only.
The choice to utilize a provisional measure allows these restrictions to take effect immediately, which comes just weeks ahead of the elections. This strategy is seen as an effort to leverage the ongoing debates around the betting sector to bolster Lula's chances for re-election.
The Civil House is currently drafting the measure, with speculation that it is politically motivated, reflecting Lula's alignment with the growing criticism against the gambling industry in Brazil. In recent months, the betting industry has been under intense scrutiny due to rising concerns that families are becoming burdened with debt due to gambling.
Political rifts are emerging regarding the proposed measures. Rather than pursuing a full legislative process that could delay effects, Lula's administration is opting for this more immediate approach. However, factions within his government, particularly from the Ministry of Finance, are pushing back against more aggressive restrictions. The Ministry recognizes the economic significance of the betting sector and faces challenges in persuading Lula of the benefits of a well-regulated industry. Lula has echoed critics’ sentiments, declaring that if it were solely his decision, he would abolish betting in Brazil.
This viewpoint aligns with findings from the Workers' Party (PT), which indicate that approximately three out of four Brazilians oppose betting establishments, forming the basis for Lula's stance against the industry.
In terms of tax implications, the president has not adequately addressed the significant revenue generated from betting. In 2025, Brazil raised nearly BRL10 billion (approximately $1.97 billion) from taxes on the licensed betting sector. Furthermore, in the initial seven months of this year, the sector contributed BRL8.7 billion to the national treasury. The Federal Revenue Service predicts that tax revenue from this sector could reach BRL16 billion by 2026.
Beyond the potential for revenue loss, concerns extend to legal and economic ramifications. Since the regulation of the sector, companies have invested over BRL2.5 billion for licenses, and ceasing these activities could lead to extensive litigation as businesses attempt to reclaim their investments. Additionally, the anticipated tax revenue from betting is already incorporated into the Annual Budget Law and the Budget Guidelines Law, which outline federal spending priorities.
The gambling sector is anxious not only about the possibility of stringent measures against legalized betting but also about the government's ongoing struggle to rein in the illegal betting market, which accounts for nearly half of the overall segment.
