The Brazilian Senate’s Economic Affairs Committee (CAE) has approved a bill which would raise the gambling tax in the country from 12% to 18%.
The proposed increase would come in two tranches; first rising to 15% across 2026-27 before hitting 18% in 2028.
CAE said the increased tax receipts would be directed towards social security funds.
The tax increases on the gambling sector are joined by raises on fintechs in Brazil.
The bill will now proceed to the Chamber of Deputies, unless an appeal in filed in the Senate.
Legislators in the South American country attempted to raise the GGR tax rate to 18% earlier this year but the idea was quashed.
Other proposals have suggested upping the rate to 24%.
Humberto Costa, a Brazilian senator, has also filed a bill to increase the minimum gambling age from 18 to 21 and introduce a series of marketing restrictions.
The regulated Brazilian market went live on 1 January this year.
Reacting to the bill’s progression, the Brazilian Institute for Responsible Gambling (IBJR) said that the threat of the black market will continue to grow regardless of tax hikes.
Citing a study by Brazilian economic consultancy LCA Consultores, the trade body said between 41% and 51% of bets are placed with illegal operators, leading to BRL10.8bn (£1.5bn) being lost in revenue per year.
The trade body said: “The IBJR recognises and welcomes the efforts shown by the CAE to combat the clandestine market.
“The entity also understands that the insistence on raising the tax burden on platforms that operate regularly in the country does not strengthen the newly regulated sector.
“On the contrary: it stimulates the advance of the underground market, reduces the competitiveness of licensed companies and, ultimately, puts the consumer at risk.
“The fight against illegal platforms must be a priority. Measures that weaken the regulated environment only favour those who act outside the law and make it difficult to confront criminal networks that take advantage of the lack of control.”
The post Brazilian Senate committee approves new 18% GGR tax rate first appeared on EGR Intel.
Bill to progress to the Chamber of Deputies, as trade body warns tax increases will only result in black market growth
The post Brazilian Senate committee approves new 18% GGR tax rate first appeared on EGR Intel.