Adjustments to Brazil's sports betting and related tax policies are expected to make significant progress in September. The joint congressional committee responsible for the provisional measure MP 1303/25 (also known as the "BBB Tax MP," involving banks, betting companies, and high-income individuals) will receive a resolution report from the rapporteur, Congressman Carlos Zarattini, in early September.
The proposal aims to strengthen tax collection through various measures and achieve a fiscal surplus of 0.25% of GDP by 2026, with increased taxation on betting companies and bettors being one of the core contents. Zarattini emphasized that the current challenge is to balance the conflicting interests of various parties, "We must meet fiscal requirements while reaching a broad consensus with both houses of Congress to promote the approval of the provisional measures."
MP 1303/25 covers tax adjustments in multiple industries, with the sports betting industry being particularly affected. The government believes that as one of Brazil's fastest-growing industries, the betting industry should bear a heavier tax burden and make a greater contribution to public finances. Additionally, the proposal also sets a uniform withholding tax rate of 17.5% on financial investment income, eliminates tax incentives for certain securities, and strengthens taxation on cryptocurrencies.
However, the adjustment of gambling taxes has become one of the most controversial issues in Congress, as it affects not only operators but also millions of betting users. Marcos Pinto, the Secretary of Economic Reform at the Ministry of Finance, defended this, stating that the purpose of the tax reform is not to target betting or fintech, but to correct tax injustices. He said: "If one industry pays too little tax, other industries have to bear more—gambling should bear taxes in proportion to its business size, just like banks and other industries."
If MP 1303/25 is not passed by Congress by October 8, the measure will automatically expire. This will not only affect the achievement of important fiscal targets of the Lula government but also pause the taxation plan for the betting industry. According to official estimates, this industry contributes billions of Brazilian reais to Brazil each year.
