Brazil’s Federal Revenue Collects Billions from Online Betting Following New Legislation
The Federal Government reported approximately 3 billion reais in Brazil’s Betting Revenue from the online betting sector during the first five months of this year, according to the Federal Revenue Service‘s announcement on April 26.
From January to May 2025, this figure marks a staggering increase of over 40,000% compared to the same period last year, when collections were just 7 million reais. In May alone, revenues surpassed 810 million reais, representing a remarkable 23,096.8% rise.
This surge is primarily attributed to the enforcement of new regulations governing sports betting and online gaming, which took effect on January 1, 2025. The legislation mandates that betting companies obtain a license from the Ministry of Treasury, which costs around R$30 million for a five-year term. Only licensed operators are permitted to continue their activities, including advertising and sponsorship of sports teams.
“Since February, we have been collecting under the new taxation system for companies offering fixed-odds bets,” stated Claudemir Malaquias, head of the Federal Revenue’s Tax and Customs Studies Center.
The revenue generated from the betting sector is based on a 12% tax rate applied to the gross gaming revenue (GGR), which serves as the basis for calculating the tax obligations of sportsbooks.
Looking ahead, the Ministry of Treasury plans to boost revenue from online betting by increasing the rate from 12% to 18% via an alternative Provisional Measure related to the Tax on Financial Transactions (IOF), effective October 1, 2025.
Read also: Ontario iGaming Breaks Records in May with $338M Monthly Revenue
However, reports indicate that members of the Chamber of Deputies have signaled that the provisional measure faces significant obstacles and may require revision before moving forward. This message was conveyed directly to Dario Durigan, the Ministry’s executive secretary, according to Valor.
Additionally, on April 25, 2025, the federal government faced a setback when a decree to raise the IOF was overturned in Congress.
As a result, the government must explore alternative strategies to raise or economize R$20.5 billion in order to meet the fiscal target set for the 2025 budget, especially considering that R$31.3 billion in expenses have already been blocked or set aside for contingencies this year. Brazil’s Betting Revenue
