President Luiz Inácio Lula da Silva of Brazil is poised to present a provisional measure to Congress this week aimed at tightening regulations on betting in the country. Reports indicate that the government is contemplating expanded restrictions on betting advertisements and may implement a ban on online casino games, retaining only sports betting under its jurisdiction.
By utilizing a provisional measure, these regulations can take immediate effect, occurring just weeks before the elections. This move signals an intention to use the betting sector as a political tool in support of Lula's re-election campaign.
The Civil House is reportedly drafting the provisional text, and there are speculations that the measure serves an electoral strategy, with Lula tapping into the growing criticism surrounding the betting industry. Recently, the Brazilian betting market has faced intense scrutiny, fueled by concerns that gambling is leading some families into financial distress.
The political landscape regarding gambling is fragmented, with Lula opting against pursuing a full legislative bill, which could delay enactment and lessen the political impact before voting occurs. Some government factions, especially the Ministry of Finance, are pushing back against more severe interventions, recognizing the economic significance of regulated betting. Finance Minister Dario Durigan faces challenges convincing Lula of the necessity of a well-regulated industry for public finances, especially as the president has previously indicated a desire to see betting banned in Brazil, echoing sentiments shared by many opponents.
Research conducted by the Workers' Party suggests that 75% of Brazilians oppose betting establishments, strengthening Lula's rationale for his stance against this sector.
Despite his critical approach, Lula did not address the potential tax revenue implications of the betting industry. In 2025, Brazil generated nearly BRL10 billion ($1.97 billion) in tax revenue from licensed betting activities. In the initial seven months of this year alone, the sector contributed BRL8.7 billion to public finances. The Federal Revenue Service estimates that revenues could reach BRL16 billion in 2026.
Beyond revenue generation, concerns extend to the legal and economic ramifications of potential bans. Since the sector’s regulation, companies have collectively paid over BRL2.5 billion for licenses. A closure of the industry would likely trigger litigation for the recovery of these funds and reimbursement for investments made. Additionally, betting revenue is already factored into the Annual Budget Law and the Budget Guidelines Law, affecting federal spending priorities.
The sector's apprehension is compounded not just by the threat of stringent measures against legalized betting but also by the government's ongoing struggles to combat the illegal betting market, which continues to dominate nearly half of the industry.
