This paved the way for further liberalization of the country’s gambling sector, and in 2023, the government finally approved legislation to regulate online casinos and other forms of gambling.
Today, Brazil is now a country with a rapidly growing online gambling market. Online casinos can now apply for a license, and more international gambling brands are expected to penetrate the local scene in the coming years.
More About The New Gambling Regulations in Brazil
Online casinos in Brazil were officially regulated with the passage of Provisional Measure No. 1,182 in July 2023, which was later amended by Bill No. 3626/23 and passed by the Chamber of Deputies on September 13, 2023.
However, the law only took effect last month, August 2024.
Based on this legislation, gambling revenues or the total earnings of online casino operators will be taxed at 12%. They will be also required to pay a 15% corporate income tax with a 10% surcharge on profits above R$240,000 (around $48,000).
They’ll also have to pay social contributions of 9% of their earnings and municipal service taxes ranging from 2%-5% depending on what gaming services they’re offering and the municipality where their physical branch (this is required) will be.
All that considered, online casino operators should be prepared to be taxed around 55-58% of their total revenues.
Meanwhile, players will be taxed 15% on their winnings if they get over R$2,824 (around USD 547.25).
When it comes to licensing, operators can apply for one which will cost them R$30 million or around $6 million. Licenses can then be renewed every five years.
While international brands are welcome to apply for an iGaming license, they are required to have a Brazilian partner who should hold at least 20% of the capital.
Other notable requirements for operators include offering self-exclusion options to local players. They should also have a strict verification process in place to ensure the safety of the consumers. They’re allowed to confirm player identity in 24 hours to six weeks, and facial recognition will also be used.
Another important rule is that credit cards and cryptocurrencies are banned from any gambling activities.
It will be Brazil’s Ministry of Finance to oversee the implementation of the new regulations in place.
What to expect from the regulated gambling scene in Brazil
Brazil is expected to have a thriving online gambling sector. Based on recent reports, Brazil’s iGaming market is expected to have a revenue increase of 24.1% and reach a revenue of around $2 billion.
By 2028, it’s projected that revenues could reach over $3.6 billion with a 16.51% CAGR.
Some of the first few online casinos now operating in the country are Brazino 777 and Spin Casino. We can only expect more operators to enter the scene, and that means more gambling options for the locals.
Speaking of which, locals can already enjoy casino classics like slots, table games (roulette, poker, baccarat, etc.), and even arcade Aviator games online. Brazil is also a nation that loves sports, especially football, and online sports betting is also allowed in the country.
Wrap-Up: How this could impact Brazil casino operators and players
It’s a good thing that Brazil is finally regulating online gambling. It’s been an industry that has seen massive growth in the last five years, and it seems like it is the future of anything gambling.
Having these regulations in place increases the safety of the players since they’ll be playing in a regulated gambling environment. Licensed operators will have to adhere to strict standards to ensure fair play.
Since the use of credit cards and cryptocurrencies is banned, this could help players be more in control of their spending habits when it comes to gambling. Countries like the UK and Australia have similar payment restrictions to protect consumers.
The requirements for operators to run a licensed gambling site can be a lot for some. High taxes and having a physical presence in Brazil is no joke, but the UK has been doing the same thing, and the operators there have been thriving.
Even with the high taxes and expensive licenses, there are already over a hundred casino operators eyeing Brazil. That includes big names like DraftKings and BetMGM international.
