350% or 5BTC + 150 Spins!
New players only. Exclusive Welcome Bonus of 350% + 150 Free Spins
President Lula signed Bill 3,626/2023 into law on December 30, marking a historic moment for the gaming sector in Brazil. This historic occasion comes after the chamber of deputies endorsed the reinstatement of iGaming on December 21, which had been previously withdrawn by the senate.
With President Lula’s consent, a tax system that affects operators as well as individual participants was created. The proposed income tax exemption will no longer apply to personal net wins over R$2,112; instead, they will be subject to 15% taxation. Operators are subject to a 12% tax on gross gaming income, with a significant amount going toward sports development in accordance with the November recommendations made by the Economic Affairs Commission.
A key component of the new law is the Ministry of Finance’s regulatory responsibility over fixed odds betting. Businesses looking to license up to three brands will pay R$30 million, which is a significant drop from the original projections.
According to Brazil’s licensing system, operators must have self-exclusion alternatives in place for a minimum of 24 hours and a maximum of 6 weeks. Licenses are only valid for five years. Importantly, it becomes necessary to have a Brazilian board member with at least 20% of the company’s share capital. Operators need to make sure all bettors are older than eighteen by using face recognition technology for age verification.
The legislation’s inclusion of iGaming represents a major advancement. After being first banned by the Senate, the Chamber of Deputies proved its might by bringing iGaming back. Financial concerns overrode objections, with iGaming giving operators a large income boost.
The inclusion of iGaming was inevitable, according to Neil Montgomery, founder of the Brazilian legal company Montgomery & Associados, who said, “To the extent that most of the revenues for operators come from iGaming, the Federal Government wanted to collect as much tax as possible.”
The Ministry of Finance is poised to provide regulatory guidelines in response to over 130 enterprises showing interest in licensing. Hugo Baungartner, vice president of worldwide markets at Aposta Ganha, a Brazilian casino operator, highlighted the government’s calculated action, saying, “The government knew that iGaming was crucial for their 2024 budget,” demonstrating the growing significance of the sector.
The ratification of Bill 3,626/2023 solidifies Brazil’s recognition of the existence of the gambling sector, despite objections from some quarters. A new age in Brazilian gaming is made possible by the regulatory environment, which is evolving together with the business.