A 15% tax on player deposits in Brazil has passed the Senate, leaving licensed gambling operators fuming—and illegal sites celebrating.
Deposit Tax Branded a “Gift” to Illegal Operators
Brazilian senators have approved a controversial 15% tax on deposits made to licensed gambling platforms, part of the broader Antifaction Bill aimed at curbing organised crime. But instead of hitting criminal enterprises, critics say it will do the opposite—by driving players straight into the arms of illegal operators.
The vote passed 64-0, and now heads back to the Chamber of Deputies before landing on President Lula’s desk.
Licensed operators and trade bodies, including the National Association of Games and Lotteries (ANJL) and the Brazilian Institute of Responsible Gaming (IBJR), are sounding the alarm. They argue the tax unfairly penalizes legal businesses while making unregulated platforms more appealing to players who want their full deposit value.
“Taxing a BRL100 deposit means legal sites can only offer BRL85 in play. Illegal sites? The full BRL100,” said the IBJR. “That’s not regulation—it’s a recruitment drive for the black market.”
Bill Could Backfire, Say Industry Insiders
The timing couldn’t be worse. Brazil’s regulated online gambling market only launched this year, and the industry is still finding its footing. Instead of providing a runway for growth, the new tax threatens to kneecap legal operators before they’ve gained traction.
The ANJL called it a contradiction: “By overtaxing legal platforms, you shrink the formal market and hand a competitive edge to sites that pay no taxes and follow no rules.”
The IBJR added that the math simply doesn’t add up. The government claims the tax will raise BRL30 billion annually, nearly matching the entire current revenue of the regulated market (around BRL36 billion). “It’s a financial fantasy,” said the group.
Worse still, the tax is part of a wider plan that includes a retroactive 15% levy on gambling activity between 2018 and 2024—years before the market was officially regulated. That’s raised serious concerns about the viability of operating legally in Brazil at all.
Colombia’s Cautionary Tale
Brazil isn’t the first Latin American country to test this approach—and others haven’t fared well.
Colombia introduced a 19% VAT on deposits earlier this year. Within two months, online gaming revenue reportedly dropped by 30%, according to Fecoljuegos, the country’s gaming trade body.
“The tax made legal gambling more expensive, and players left for illegal sites that don’t charge fees,” Fecoljuegos said. Brazilian operators fear a similar outcome, particularly with 51% of the market already in the hands of unlicensed platforms, based on IBJR figures.
Gradual Tax Increase Plan Also in Limbo
While the deposit tax barrels forward, another proposal to gradually raise the overall gambling tax rate has hit a speed bump. The bill—PL 5,473/2025—would hike taxes from 12% to 15% in 2026 and 2027, then 18% in 2028. It had cleared a Senate committee but now faces further debate after 19 senators signed an appeal to delay it.
With Brazil’s government heading into recess later this month, that plan is now likely on ice.
Players Caught in the Crossfire
For everyday Brazilian players, the 15% deposit tax could be a tipping point. Whether they want better odds, more play value, or just to avoid fees, many may now look offshore—feeding a black market the government claims it’s trying to dismantle.
As one operator bluntly put it: “We followed the rules. The illegal guys didn’t. And now they’re the ones winning.”
