The Brazil betting market is set to become the fifth-largest in the world by generating revenues in excess of $4 billion in 2025, according to projections by global strategic advisory business Regulus Partners cited in a recent news report.
At the start of the year, Brazil introduced a comprehensive regulatory framework for online casinos and sports betting. The roll out appears to have gone smoothly, with financial reports and estimated betting volumes suggesting the country is closing in on Italy (USD $4.617billion) Russia ($4.515 billion), and the United Kingdom ($16.6 billion), though the United States ($115 billion) is way out in front.
The South American country has a population of approximately 213.4 million people, which is the seventh-most populous in the world.
Some industry professionals are predicting Brazil to step forward as a compliance leader. Vitor Silveira de Andrade, CAO of Brazilian betting firm 1PRA1, told BBC News Brasil: “Brazil has all the conditions to soon become a global reference in regulation and best practices”.
Gambling regulation lays the building blocks for success
Gambling reform was a key priority for current president Luiz Inácio Lula da Silva when he came to office for a third time back in 2023. His government established the Prizes and Betting Secretariat (SPA) within the Ministry of Finance later in the year.
In October 2024, more than 2,000 unlicensed gambling sites were blocked by authorities ahead of the transition to regulated platforms. At the time, SPA secretary Regis Dudena said: “It is very important for bettors to understand that, for the sake of their mental and financial health, it is better to be in a regulated environment, where companies operate that are actually willing to comply with the rules.”
“Collaborating with illegal companies means contributing to companies that, ultimately, will defraud the bettors themselves. That is why it is very important to understand the separation between these two groups.”
Betting had been legally available to the public in Brazil since 2018, but there were concerns about the longer-term health of the wider public without proper oversight. In 2023, Brazil’s economy ministry estimated the sports betting market had $21 billion in transactions, a 71% increase compared with the first year of the pandemic in 2020.
Government chaos in gambling taxation policy
While the first year of legal betting in Brazil has yielded some eye-catching numbers, there have been political tensions surrounding the appropriate taxation policy in Brasilia, the legislative capital.
Back in October, a proposed tax plan that included a rate increase of 18% was scrapped at the eleventh hour and replaced with a retroactive taxation model branded Litígio Zero Bets. The amendments, introduced by the bill’s rapporteur Carlos Zarattini, retrospectively tax licensed betting operators in Brazil, meaning they must pay tax on gambling operations dating back to 2014. The measures expect to raise BRL5 billion ($560 million) from the retroactive tax program, the equivalent of three years of revenue were the rate to have been raised to 18%.
It was a win for the betting industry, which had been fearing the hefty 6% tax hike. However, the last-minute move reportedly led to furious finger-pointing in congress, with lawmakers given just 24 hours to consider the changes before it went to a vote. It eventually passed.
Offering his reaction to the vote passing, Mr Zarattini said he was pleased to recoup government money lost to the previously de-regulated sectoro. He said: “We’ve done everything we can to ensure that the funds from bets, which weren’t paid under the previous administration, now reach the public coffers.”
However, he attracted some criticism: “Changing the fiscal rules without due process creates legal uncertainty. It undermines investor confidence and risks deterring new entrants from joining the regulated market,” Plínio Lemos Jorge, president of the National Association of Games and Lotteries (ANJL), said at the time.
Brazil still getting to grips with regulated betting
Despite the political friction, many analysts believe the broader direction of travel remains clear. After years of uncertainty, Brazil has moved to a defined legal structure, backed by active enforcement and one of the largest potential customer bases in the world.
Operators, investors and regulators are still adjusting to the new rules, but early revenue indicators and market projections suggest the sector is stabilizing rather than slowing.
Whether the government can maintain regulatory consistency and give the industry room to mature remains to be seen.However, the country is expected to remain one of the fastest-growing betting markets globally. For many observers, the first full year of oversight marks a turning point and signals that the country is poised to play a much bigger role in the international iGaming economy in the years ahead.
References
- iGaming News Today: https://igamingnewstoday.com/sports-betting/brazil-set-to-become-the-worlds-fifth-largest-betting-market/
- Gaming Intelligence: https://www.gamingintelligence.com/legal/compliance/203626-brazilian-isps-begin-blocking-more-than-2000-illegal-gambling-sites/
- AP News: https://apnews.com/article/sports-betting-brazil-crisis-e199e0ef30228c15fd25820b1a69a900
- iGaming Business: https://igamingbusiness.com/finance/tax/brazil-approves-measure-retrospective-tax-betting-operators/
