On 8 April, president Luiz Inácio Lula da Silva once again publicly declared that online gambling is responsible for the rising indebtedness of Brazilian families. It was not the first time. Back in March, on International Women’s Day, he made a similar argument, framing betting as a burden that falls disproportionately on women, whose household budgets absorb the losses generated by the men in their lives.
News outlet O Globo has now reported that a presidential decree to curtail the sector could be published in May. The narrative is compelling. The problem is that it does not hold up particularly well against the data, and the timing makes the political motivation hard to ignore.
The election context
Brazil is holding its general election on 4 October. Lula, at 80, is running for an unprecedented fourth term. He is in a statistical dead heat with Flávio Bolsonaro, the senator son of the imprisoned former president, who carries his father’s endorsement and the full mobilisation capacity of the evangelical and rural networks behind the Liberal Party.
Recent polls by Datafolha and Nexus put both candidates at 46% in a simulated runoff, a genuine coin-flip by any measure. In that context, the evangelical vote matters enormously. Evangelical Christianity has grown from roughly 7% of Brazil’s population four decades ago to around 30% today, making it one of the most politically decisive blocs in the country and, historically, one of the most hostile groups toward gambling.
This is not new territory for Brazilian politics. Online sports betting was legalised in 2018 under president Michel Temer, with a regulatory framework to be put in place within two years. Bolsonaro’s government chose not to regulate it, deliberately forgoing tax revenues and any form of player protection rather than antagonise his evangelical base. The market operated in a legal grey area for years as a direct result. Lula is now playing the same game from the other side.
The numbers game
There is no question that Brazil has a serious household debt problem. In February 2026, family indebtedness reached 80.2%, the highest level recorded since the Confederação Nacional do Comércio began tracking the numbers in 2010. What is equally striking, and far less discussed, is what is actually driving it.
The Selic rate, Brazil’s benchmark for interest rates, has sat at 15% since June 2025, the highest in two decades. Credit card revolving interest runs at 451% annually. The country is running one of its largest fiscal deficits since Plano Real – fiscal policy to curtail hyperinflation in Brazil – stabilised the economy in 1994. These are the structural forces compressing Brazilian household finances. Attributing the debt crisis primarily to gambling requires a significant leap of logic.
Independent consultancy LCA found that the share of indebted families remained essentially stable between 2022 and 2024, and that even if all gambling spending were redirected to debt repayment, the reduction in total indebtedness would be under 0.5 percentage points.
There is one area where the concern has real empirical grounding: in Brazil’s D and E income brackets, the share of the family budget going to betting has risen from 0.27% in 2018 to 1.98% today. That is a genuine social problem. But it is not the same thing as claiming gambling is driving a macro-level debt crisis.
The political irony is hard to overstate. The same government threatening to cancel gambling licences has built its 2026 budget around those very revenues. By November 2025, the federal revenue department, Receita Federal, had collected BRL8.82bn (£1.3bn at today’s exchange rate) in taxes from gambling activities, with monthly receipts growing from BRL13m in November 2024 to BRL852m in that same month one year later.
An additional BRL2.4bn came from licensing alone, with 80 operators each paying BRL30m for a five-year licence. The 2026 federal budget already incorporates approximately BRL35bn in projected gambling-related revenues. The legal exposure of any reversal would be equally significant. Companies that obtained those licences less than two years ago made substantial financial commitments based on a framework the government itself created. A ban or retroactive cancellation would trigger a wave of litigation damaging not just the sector, but investor confidence in Brazil more broadly.
Removing regulation doesn’t remove gambling
The most important point in this debate is also the least politically convenient: regulation did not give Brazilian bettors access to gambling. They always had it. When the regulated market launched in January 2025, licensed operators captured 55% of online betting activity in the first quarter. By the second quarter, that share had already fallen to 45%, as illegal offshore operators adapted faster than regulators could respond.
Today, more than 50% of Brazil’s online betting market operates entirely outside the regulated framework. Illegal operators pay no taxes, ignore responsible gaming requirements and are frequently linked to organised crime. Any prohibition on regulated gambling would not eliminate gambling. It would simply hand the entire market back to those operators, removing oversight, consumer protection and every real of tax contribution in the process.
The Brazilian gambling industry deserves scrutiny, and the regulatory framework is still young and imperfect. But the conversation the country needs is about how to make regulation work better, not whether to dismantle a market that will continue to exist regardless of what Congress decides.
Ramiro Atucha is CEO and founder of Atucha Strategic Advisory and a recognised leader in the global iGaming sector. With nearly 20 years of industry experience, Atucha has played a pivotal role in shaping some of the sector’s most innovative businesses.
He co-founded Leander Games in 2007, serving first as CEO and later as COO until 2019. In 2019, he co-founded Vibra Gaming, a content and platform supplier specialised in the Latam market.
This article includes insight from our data partner, EGM. A GGR-focused product launched earlier this year, delivering broader market coverage and data-led insight across the global gambling industry. Click here to find out more about EGM and book a demo by clicking here
The post Atucha Strategic Advisory: Lula’s gambling U-turn is about votes, not Brazil’s debt first appeared on EGR Intel.
Ramiro Atucha unpacks the logic behind the president’s anti-gambling push and argues dismantling the legal market would trigger a wave of litigation and damage investor confidence in Brazil more broadly
The post Atucha Strategic Advisory: Lula’s gambling U-turn is about votes, not Brazil’s debt first appeared on EGR Intel.