Resistance from Business Sector

In the heart of Brazil's political landscape, a heated debate on gambling regulation is unfolding. Senator Costa has taken a firm stance, arguing that the social costs associated with regulated betting far outweigh its tax benefits. He asserted that not a single cent of the tax collected by these companies can compensate for the social harm they inflict.

This stance is a call to action against a growing social epidemic, particularly affecting young people and the most vulnerable. The senator's proposal is seen as a wake-up call, highlighting the need for stricter regulations to combat the problem.

The sustainability of the gambling operators depends heavily on improving "channelisation" – the share of consumers choosing licensed platforms over illegal alternatives. This is crucial to ensure the viability of the legal market.

In line with this, the government has temporarily increased the tax rate on operators' gross gaming revenue from 12% to 18%. However, the future of this increased rate hinges on Congress' decision in October.

Meanwhile, PL 3,754/2025, a bill proposing stricter regulations, is awaiting dispatch. If enacted, its measures would take effect 90 days after publication. This bill has created a divide between policymakers seeking tougher safeguards and an industry that fears overregulation could jeopardize the viability of the legal market.

The current status of support for bill PL 3,754/2025 in the Chamber of Deputies is not publicly available as of now.

On a related note, the Senate has approved new advertising restrictions, including a watershed similar to Senator Costa's proposal. Finance Minister Fernando Haddad has also expressed support for a full ban on gambling if it reaches the Chamber of Deputies.

However, operators and trade groups warn that escalating restrictions could undermine the regulated market and drive players to the black market. They argue that such a scenario would make it difficult to enforce regulations and protect consumers.

Moreover, betting has become a significant tool for emotional and financial manipulation. As the gambling sector in Brazil, recently regulated, comes under scrutiny, it is crucial to strike a balance between regulation and consumer protection.

In this complex landscape, the path forward for gambling regulation in Brazil remains uncertain. The debate continues, with both policymakers and the gambling industry grappling with the need for stricter regulations and the potential impact on the legal market.