President Luiz Inácio Lula da Silva has sanctioned legislation approved by Congress that reduces federal tax exemptions and introduces a progressive increase in taxation on betting operators, marking another step in the consolidation of Brazil's regulated gambling market.
Published in the Official Government Gazette, the law raises the tax burden on betting companies to help fund social security.
From 2026, 1% of operators' revenue will be allocated to social security, rising to 2% in 2027 and reaching a cap of 3% in subsequent years.
According to the bill's rapporteur, the measure is expected to generate BR850m ($152m) in additional revenue in 2026.
The legislation also includes provisions holding individuals accountable for promoting betting platforms that operate illegally in Brazil, reinforcing enforcement mechanisms as the Government seeks to curb the unregulated market.
Alongside the tax measures, Lula vetoed a clause inserted during congressional debate that would have allowed the reinstatement of unpaid parliamentary amendments from 2019 to 2023, estimated at around BR3bn.
The new tax framework follows a year of strong revenue collection from betting in the country, with Brazil collecting around $1.6bn between January and November in federal tax on gambling activities.
Besides that, international operators continue to monitor Brazil's regulatory environment as part of their expansion strategies, as one of Kalshi's Co-Founders has said they're expecting to reach the country by next year.
As the regulated betting market in the country completes its first year of legal operation, the framework remains in a period of adjustment.
National Government is still refining its approach, balancing revenue generation with market stability, consumer protection and regulatory oversight as the sector continues to evolve.
Brazil's Supreme Court previously suspended all municipal betting laws nationwide, reinforcing federal oversight of gambling regulation