Editor's foreword: 2026 has truly been the year of taxation for gambling globally. Even after the Netherlands Gambling Authority said its tax rise had actually reduced tax revenue, calls - politically and culturally motivated - for greater taxes on gambling have only increased.
That is just where gambling sits within society; and I do wonder whether that's forgotten when industry commentators convene at trade shows to discuss what policies might fit best for them. There is a whole world outside our sector that shares very different opinions.
But, even considering all of the above, the UK's ruling last month to increase remote gaming duty from 21% to 40% in April 2026 was a seismic move. Meanwhile, the Brazil Senate this week approved a 15% tax on player deposits. I sat at my desk in shock for a moment, if I am totally honest.
The new Brazilian tax has not yet been signed into law but, to me, its consideration at such a high level is simply beyond belief. Neil Montgomery tells us more...
Constant change, no consistency
B2C operators having secured a Brazilian federal license to exploit the regulated gaming market launched on 1 January 2025 must have had to revisit their initial business plans and cost structures throughout the year due to the many surprises triggered by a factor common when doing business in this jurisdiction: lack of legal certainty. In 2025, this surfaced mostly with the ugly face of increasing taxation.
In January, licensed operators faced a tax burden comprising all federal and municipal taxes and contributions paid by other Brazilian service providers, plus two additional monthly payments: gross gaming revenue (GGR) contribution (at the rate of 12%) and an inspection fee in a fixed sum ranging from just over BR50,000 to just under BR2m ($9,000 - $369,000).
After the Federal Government's frustrated attempt to increase the GGR contribution to 18% (representing a 50% increase), Bill of Law No. 5473/2025 is progressing at Congress and aims to implement a gradual increase in the GGR contribution to 15%, in 2026, and 18%, in 2027. This is still to be reviewed by the Senate's Plenary before it can be forwarded for sanctioning.
In turn, Bill of Law No. 5,582/2025, which aims to combat organized crime, creates a new tax called CIDE-Bets and is levied on bets collected by operators. The envisaged rate is 15% and BR30m in annual revenues are forecast. This Bill of Law also establishes a retroactive tax collection program permitting unlicensed operators to settle their purported tax debts with the tax authorities going back five years.
"Significant impact on shareholder returns"
Further, President Lula recently managed to deliver one of his most important campaign promises with the enactment of Law No. 15,270/2025, which exempts salaries of up to BR5,000 from personal income tax, taxes the "super rich" with a minimum personal income tax of up to 10% on annual income above BR600,000 and, after three decades of full exemption, as from January 2026, taxes the remittance of dividends overseas at a rate of 10%. To the extent foreign investment has a key role in the Brazilian gaming industry, such increased taxation on profits being repatriated to foreign parent companies will have a significant impact on shareholder returns.
While other legislative threats enhancing Brazilian taxation on licensed operators exist, it is evident that Brazil is digging its sharp teeth too deep into the jugulars of companies which may seem to have deep pockets, but, actually, should be regarded as entertainment providers with heavy cost structures and low margins (especially when RTPs are currently in the 90%-93% range).
The enactment of the bills of law either increasing or creating new taxes may ultimately see licensed operators going insolvent or being acquired by larger players and new potential market entrants hesitating from obtaining a federal license. It is obvious that such movement will also contribute to enlarging the illegal market even further (with many already estimating the black market to be between 50% and 70%). It is time for the Brazilian authorities to stop overmilking the industry and regarding it as the golden goose before it is too late.
It's not all doom and gloom, as Brazil has made positive progress recently with the creation of a national self-exclusion scheme
