Short and objective answer: no, it is not. This question has probably already crossed your mind, but know that placing a bet in Brazil is completely legal. It’s as cool as buying a shirt from that online store you like so much. And if, on the one hand, e-commerce gained prominence around the world, so did sports betting.
Recent statistics show that 23% of Brazilians have already had contact with this “universe” and it is estimated that the number has increased. Did you know that by 2029 sports betting is expected to generate 89 billion dollars? Well, you read that right. It’s a lot of money. So, there are several questions that emerge. Were betting always legal in Brazil? What motivated these legislative changes? In this article we explain everything. If you want even more detailed information, see https://www.igamingtoday.com/gambling-regulation-in-brazil/.
Has it always been legal to place sports bets in Brazil?
No, not always. First, we have to remember that sports betting is relatively new. To give you an idea, the first betting house appeared in 1992 but it was only in the last five years that this began to be a recurring practice. Many reasons are behind this increase. The first, and most obvious, is that people look for the “easy” opportunity to make money. The second reason lies in the internet itself. With the democratization of the internet, it has become easier and more accessible to place a bet. Nowadays, in just a few clicks you can place a bet.
But this was not always possible. In 1946, all casinos were banned. Until today. It is not yet possible to visit a casino because they are illegal in the country. In Portugal, for example, you can easily enter a casino, play, withdraw your money and leave. In Brazil this is not possible. In betting houses, this process also only started in 2018 with Law 13,758/18. Initially it was a confusing law, but in 2023 something changed.
What changed in 2023?
In 2023, Law 14790/23 arrived. It defines the rules, rights and duties for both operators and players involved in sports betting, whether in person or digitally. The legislation also regulates the processes necessary to obtain permission to act as a betting house, establishes limits on advertising and determines fiscal and tax rules related to profits obtained from betting.
Law 14,790/23 regulates fixed odds betting in Brazil, characterized by a fixed multiplier applied to each real bet in case of victory. This betting format covers: (1) sports betting related to real events and (2) betting on virtual online gaming events. What does this allow? That operators explore this market, thus making them legal.
New regulatory framework for betting in Brazil: Reforms and Challenges
It was then in December 2023 that Brazil implemented a new regulatory framework that brought significant changes to the betting sector, including fixed odds betting and online casinos. This new set of rules aims to guarantee security, transparency and economic benefits, in addition to establishing a more controlled and responsible market.
The main change is that betting operators now need to be established in Brazil, allowing the government to collect tax revenue and ensure that companies comply with local regulations. Foreign operators are prohibited from offering regulated betting in the country, which aims to increase control over the market and reduce illicit practices.
The new tax model is one of the most important innovations. Operators will be taxed 12% on revenue, while players will be taxed 15% on their winnings. This structure seeks to balance revenue generation with social responsibility, creating a robust tax system for the sector.
What motivated the changes?
There are many reasons, but there are two that stand out:
- Brazilians wanted this: The people always have a vote on the matter. Bets are very popular and we have previously demonstrated numbers to prove this. As such, public opinion began to put pressure on them to become legal. Many gamblers were doing this illegally and began to demand a safe space to do so. Furthermore, what would be the reason for doing so illegally by giving money to foreign companies? This brings us to the second reason.
- Money spoke louder: Politicians began to do the math and began to realize that they could be raising a lot of money if they did so. By taxing the (gigantic) profits of these companies, they would be collecting many millions in the coffers. Do you know what the bills were? They estimated that in the year 2023 alone this would generate 1.5 billion in revenue for the state.
What will the future bring?
Nobody knows. But money usually talks very loudly and in this case the law is expected to remain permissive. Of course, there are risks associated with betting, but the government is creating some measures, namely regulatory entities to monitor the activity and also some associations to support bettors who are unable to establish limits. If this is your case, know that you can easily seek help.
