Brazilian Senate Committee approves tax hike for betting operators and fintechs
Brazil’s Senate Economic Affairs Commission has approved a bill raising taxes on betting companies and digital finance firms.
The proposal from Senator Renan Calheiros now moves to the Chamber of Deputies unless a plenary appeal is made.
Fixed-odds betting operators would see their contribution on gross gaming revenue rise from 12% to 15% in 2026 and 2027, and then to 18% in 2028.
Funds are earmarked mainly for social security and health, with temporary transfers to state and local governments allowed to offset revenue losses from income-tax exemptions for public servants.
Additional measures include anti-money laundering duties for fintechs and betting firms, as well as the creation of a regulatory compliance index in betting to monitor adherence.
This comes as several gaming companies have entered Brazil, including online gaming developer Bejoynd, which earned its Brazil certification last month.
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The Backstory
Tax momentum shifts across markets
Brazil’s push to lift levies on betting operators and fintechs lands as governments from Baton Rouge to Santiago reset how gambling is taxed, supervised and justified to voters. The pattern is familiar: policymakers promise steadier funding for public priorities and tighter oversight, while operators warn that rate hikes and new compliance burdens could thin margins, curb promotions and slow formalization.
In the United States, statehouses are testing where that balance sits. Louisiana advanced a proposal to more than double its sports betting tax to 32.5%, aligning it with video poker. Backers say the plan would channel new dollars to addiction services and college athletics. The House Appropriations Committee moved House Bill 639 forward on a 20-1 vote, tying it to an insurance tax bill and projecting up to $31 million yearly for a new fund supporting NCAA Division I programs. Sportsbook operators countered that Louisiana already sits above the national average and that a rate near one third of gross gaming revenue would squeeze offers and handle.
Chile, facing a fast-growing gray online market, is taking a different tack. Lawmakers are building a legal framework first, then setting a tax structure they say will be competitive. The Senate Finance Committee unanimously approved a bill to regulate online gambling with responsible gaming rules, platform blocks and identity verification. Officials signaled an effective burden that would not exceed 28% and confirmed that standard value-added tax would still apply to online services. The proposal heads to the Senate floor after months of hearings with international brands and local casino operators, as detailed in the committee’s unanimous vote.
These moves frame Brazil’s debate: higher rates can help fund social spending and formalize a thriving market, but the tally of obligations matters. In Brazil’s case, a step-up schedule paired with anti-money-laundering requirements and a compliance index aims to blend revenue needs with guardrails. The open question is how operators price and promote in response.
U.S. budget fights put gambling tax policy under the microscope
The U.S. conversation is not confined to state coffers. A federal budget package drew backlash from gamblers and tax practitioners for a provision that would cap the deductibility of gambling losses at 90% against winnings. That change, folded into a broader tax deal, would introduce a structural penalty even for players who break even over a year. Industry participants warned it could distort behavior and bookkeeping, and Nevada’s congressional delegation signaled it wanted a fix. The concerns were captured in reporting on gambler backlash to the budget bill, with discussion of potential impacts on professional and casual bettors alike.
The timing is notable. U.S. commercial gaming revenue hit a fourth straight record year, according to the industry’s main trade group. The American Gaming Association reported $71.9 billion in 2024, buoyed by growth in online books and casinos. The topline underscores why tax writers view the sector as a dependable source of cash. It also highlights the stakes for operators scaling nationally. Readers can see the AGA’s breakdown here. News coverage has also surfaced consumer-facing alarms over the federal proposal, including a roundup of player complaints on MSN that flagged the change as a $1.1 billion hit, available here, and the legislative text hosted by Congress here.
The through line to Brazil is the same: whether the tax target is operators or consumers, fiscal changes can alter acquisition costs, player liquidity and the appeal of offshore sites. Policymakers are weighing those tradeoffs against near-term revenue and political momentum for stronger oversight.
Public health funding becomes a bargaining chip
As tax rates climb, earmarks for addiction services and research are increasingly used to build bipartisan support. Louisiana’s bill pairs its steep increase with dollars promised to treatment programs. Hawaii, a historically gambling-averse state, advanced a bill to legalize online sports betting with a 10% tax on operator revenue and a dedicated Problem Gambling Prevention and Treatment Special Fund. The measure passed a sixth committee with an 11-2 vote and would set a minimum of four licenses if enacted this session.
Congress is also moving on problem gambling, albeit through the defense budget. The Senate Appropriations Committee approved a provision to allow gambling disorder to be studied under the Department of Defense’s Peer-Reviewed Medical Research Program. The step, backed by major operators and the National Council on Problem Gambling, would open a federal funding channel for research on service members and veterans. The action is outlined in the committee’s approval of military gambling addiction research. For context on prevalence and training resources, the council’s materials are accessible here.
Brazil’s plan to direct proceeds to social security and health mirrors this approach. It signals that gambling revenue is being designated as a tool to stabilize programs while lawmakers fine-tune compliance regimes. The policy wager is that visible public benefit can blunt opposition to higher rates and a larger regulated footprint.
License design and market entry shape the tax base
Hawaii’s bill sketches how new markets may condition entry on cleaner tax and compliance lines. It would place licensing under the Department of Business, Economic Development and Tourism, limit early licenses and set a go-live before Jan. 1, 2026. Those choices echo Chile’s preference for clear operating standards before tax escalators. In Louisiana, by contrast, the framework is set and legislators are trying to retrofit higher rates while keeping operators on board.
Brazil faces both jobs at once. The country has drawn international suppliers and operators eager to serve a populous, digital-first market. Sequencing matters: if compliance expectations and tax schedules are predictable, new entrants can model profitability and invest. If the state layers on AML, reporting and stepped rates without clarity on enforcement, marketing or payout rules, operators may trim back offerings or defer launches, which could slow the migration from unregulated play.
Compliance and AML pressures tighten the screws
Beyond headline rates, the compliance burden is rising fast. Chile plans biometric checks and payment restrictions to block illegal platforms. Louisiana’s debate includes administrative questions tied to oversight of higher receipts. In Washington, the defense research measure acknowledges that gambling’s risks touch federal workforces, not just consumers, and points to a public health lens.
Brazil is signaling similar intent with enhanced anti-money-laundering duties for both betting firms and fintechs, plus a regulatory compliance index that would monitor adherence. Those tools matter as tax rates increase. Stronger AML and reporting can improve integrity and help justify steeper taxes, but they also add fixed costs that hit smaller operators harder. The net effect on competition, product variety and pricing will determine whether higher official take coexists with continued market growth.
Across jurisdictions, the playbook is converging: tighten compliance, earmark funds for visible social needs and test how far tax rates can rise without pushing bettors back to unlicensed sites. Brazil’s next steps will show whether a phased schedule and oversight upgrades can thread that needle in one of the world’s most coveted betting markets.
