Brazil Inches Closer to Regulated Sports Betting

The government of South America’s largest company has issued a provisional decree that authorizes the regulation of retail wagering and online sports betting sites.

Brazil is one step closer to authorizing legal sports betting amid controversy of alleged match-fixing.

The government of South America’s largest company has issued a provisional decree that authorizes the regulation of retail wagering and online sports betting sites. Brazil President Luiz Inacio Lula da Silva issued the decree on Tuesday, which also calls for betting operators in Brazil to have their revenue taxed at an 18% rate. The provisional decree will head to Brazil’s congress for a vote within the next 120 days for its fate to be determined.  

The recent push to authorize legal wagering comes after Brazil's Minister of Finance Fernando Haddad introduced sports betting legislation earlier this year. The bill proposed to compensate the government treasury for the loss of tax revenue following an increase in the country’s minimum tax rate by da Silva. The bill also prevents offshore sportsbooks from profiting. 

Last year, Brazil explored regulated sports betting but a provisional decree failed to receive a signature from outgoing President Jair Bolsonaro. Now, the country can reap the benefits of a growing industry. In 2024, Brazil’s finance ministry is projected to generate $420 million in tax revenue from sports betting. Brazil bettors won’t pay a tax on wins under $445 but wagers over that figure are taxed at 30%.

It is unclear what operators could seek market access in Brazil. However, sportsbooks including bet365 and Betfair have secured sponsorship deals with Brazilian soccer clubs, per Reuters.

Integrity issue

Brazil is looking to regulate sports betting despite a national investigation into alleged match-fixing in soccer. 

In May, Brazil prosecutors charged 16 people for alleged match-fixing. The group included professional soccer players involved in a scheme aimed at fixing 13 matches in Campeonato Brasileiro Série A and Série B — Brazil’s top-flight professional soccer leagues. Colorado Rapids midfielder Max Alves was also suspended by the team as a result of the Brazil native being included in the investigation.

According to charging documents, players were paid by a criminal organization to commit infractions during gameplay. The organization would offer players payments of up to $100,000 for committing the infractions. Alves was allegedly paid around $12,000 to receive a yellow card during a match against the L.A. Galaxy in September 2022.

The International Betting Integrity Association reported 50 incidents of suspicious betting activity in Q2 2023. During the quarter, soccer led the eight sports included in the IBIA’s report. Soccer had 19 incidents of suspicious activity across four continents in Q2 — up 27% compared to Q1.