The sports betting market, known as “bets”, will be officially regulated in Brazil in 2025. According to economists, the regulation of bets is expected to generate between 2 and 10 billion reais to the government’s coffers next year.
The value is considered low by analysts, given the growing volume of online betting in the country. Furthermore, the consolidation of this segment in the consumption profile of Brazilians is evident.
However, economists say that, as it is still a growing market, revenue gains could increase in the future.
Expectations and the impact of betting regulation
Companies will pay 12% tax on the income from each bet, after the prizes are distributed. They will also need to pay IRPJ (Corporate Income Tax) and CSLL (Social Contribution on Net Profit), increasing the tax burden.
Therefore, bettors’ winnings above R$2,112 will be taxed at a rate of 15%. Companies interested in exploring the Brazilian market must pay a subsidy of 30 million reais to the government.
The deadline for companies to request regulation was set at August 20th. A total of 113 applications were received.
Subsidy payments to government-approved candidates must be made by the end of the year. The regulation of bets is expected to generate revenue of around 3 billion reais in 2024, according to estimates by the Ministry of Treasury.
But for 2025, Santander Brasil economist Ítalo Franca is working with betting revenue of 5 to 10 billion reais. However, he emphasizes that there is still uncertainty about the numbers, due to the new nature of the market. It is not known how taxes will affect consumer habits for sports betting.
Thus, a large part of the revenue will come from taxation of the companies themselves and the payment of new subsidies. For analysts, most players tend to stay within the exemption limit, according to the economist.
“The majority (of bettors) may even lose money, so this bulk of the revenue will come from betting revenue like a normal company,” said Franca.
The future of the betting sector
The economist at ARX Investimentos, Gabriel Leal de Barros, estimates that, depending on the level of maturity of the betting market, the regulation of bets could generate between 8 and 10 billion reais per year in revenue for the segment.
In 2025, he predicts much more modest revenue, of around 3 billion reais. “This may end up helping the government in one way or another, but it is far from solving any budget problem,” he emphasized.
Barros agrees that, from the point of view of taxing bettors’ profits, income from betting tends to be insignificant.
“Some studies indicate that bettors come from classes C and D. The value of what we call the average ticket for bets is low, around R$100″, he highlighted.
So, for Barros, the prospects for income from betting are low, especially considering the values that the sector generates every year.
However, he stressed that there is already a broader bill in Congress that aims to legalize other types of gaming, such as bingos and casinos. “The evolution of the market depends on the progress of this other bill in Congress”, concluded Barros.
