The Secretariat of Prizes and Bets’ (SPA) fight against the illegal betting market in Brazil is restricted by limited resources, local gambling lawyer Udo Seckelmann has told iGB.
The licensed betting sector in Brazil continues to be hampered by a sizeable illegal market. Broad estimates suggest the black market accounts for between 41% and 51% of the overall market.
The SPA, which sits within the Ministry of Finance, has taken steps to combat the issue, however some in the industry have raised concerns over resources, including manpower.
Last month, the Brazilian Federal Court of Accounts (TCU) gave the Ministry of Finance 120 days to strengthen the structure of the SPA following a report that highlighted a lack of human resources within the regulator. It noted staff shortages had been exacerbated by insufficient and dated technology.
Seckelmann, head of gambling & crypto at Bichara e Motta Advogados, believes the SPA is a “very good regulator” overall, and it should be commended for what it has achieved so far.
“In terms of regulation, in terms of dialogue with the market, they have been very good so far,” Seckelmann tells iGB. “At the same time, they lack people working there. There are not enough people to work in a regulator that oversees this whole market.
“I talk to people from the SPA all the time and they all say the same thing, that they don’t have enough people. They needed the government to hire more people.”
Where is Brazil’s gambling tax revenue going?
The gambling tax rate on operators currently sits at 12% of GGR, although a recent law change will see this rise to 13% this year, before increasing to 14% in 2027 and 15% from 2028 onwards.
The latest data from the Federal Revenue Service revealed the licensed gambling market in Brazil raised BRL8.8 billion in tax revenue in its first 11 months. However, it is unclear how much of this will be put back into funding the SPA’s regulatory activities.
The SPA also faces an issue with high staff turnover, according to Seckelmann. “For some reason [the Ministry of Finance] is not hiring more people and, worse, they are actually changing people within the SPA very frequently.
“During [2025], I had some connections that just left the SPA or were hired in other places, even within the Ministry of Finance. So they changed their position.”
“It’s very tough to say the SPA is not doing a great job on combatting the illegal market, because there are so few people there that we know it’s not exactly their fault,” Seckelmann adds. “So, this is something that has been tough for the past months.
“From one side their work so far has been very good. Of course, there are some things that have to be increased, the combatting of illegal market, other aspects of the sanctioning of the operators that are not doing some stuff correctly. But at the same time, they have so few people, that it’s difficult to say that they should do more.”
Responding to iGB’s request for comment, the regulator stated it’s evaluating the TCU’s document to comply with its instructions.
“Since its creation in 2024, the SPA has continuously sought to improve its structure, both in terms of personnel and technological systems,” the SPA said. “Contributions and observations from the TCU are always institutionally considered and will form part of the administration’s resource allocation assessments.”
Other sector bodies also limited
In June Folha reported that the National telecoms regulator (Anatel), which works to block illegal gambing sites, was also facing funding issues. Anatel has reported it has blocked over 18,000 illegal betting sites since Brazil’s market launch in January 2025.
Seckelmann believes gambling tax revenue in 2026 could be double compared to last year if the government increases its enforcement against the illegal market.
Alongside the gradual rise to the gambling tax, the government is also pressing ahead with plans to introduce a 15% tax on player deposits, which Seckelmann feels could be catastrophic for the market, causing channelisation to drop below 20%.
“This is something that could destroy the whole market,” Seckelmann concludes.
Brazil’s stakeholders are concerned the regulator lacks sufficient staff to combat black market growth.