Brazil's new minister backs higher taxes on betting operators as Lula seeks wider fiscal support

Brazilian President Luiz Inácio Lula da Silva’s proposal to raise taxes on high-income earners and the online betting industry has gained fresh political backing with the appointment of Guilherme Boulos as Minister of the General Secretariat of the Presidency.

Speaking at his inauguration ceremony on Thursday at the Palácio do Planalto in Brasília, Boulos directed criticism toward opposition lawmakers who have refused to endorse the government’s economic agenda, accusing them of inconsistency.

“Let them know: for every attack there will be a response, for every lie, a rebuttal. Our role will also be to expose the hypocrisy of those who claim to be against the system and to defend the people,” he said.

He further questioned the opposition’s reluctance to support tax reforms targeting the country’s wealthiest individuals and the betting sector. “If they’re against the system, then why don’t they support our proposal to tax billionaires and ‘Bets’? If they defend the people, why don’t they join us in ending the 6x1 work schedule?” Boulos stated.

The Lula administration has been under pressure to increase tax revenues while addressing rising social spending commitments. One key element of this fiscal effort is a proposed hike in the Gross Gaming Revenue (GGR) tax applied to sports betting and online gaming operators.

The betting and iGaming industry has faced growing public criticism for allegedly contributing to gambling addiction and not paying enough in taxes. Industry representatives, however, maintain that they are already subject to a substantial fiscal burden.

Under current regulations, licensed betting operators pay a 12% tax on GGR in addition to standard corporate obligations, including Corporate Income Tax (IRPJ), Social Contribution on Net Profit (CSLL), and PIS/COFINS. According to the sector, the effective total tax burden already exceeds 25%, a figure often overlooked in public debate.

If the government proceeds with its plan to double the GGR tax to 24%, operators warn that the combined tax rate could approach 40%. Industry analysts say such an increase could make legal operations unsustainable, leading to the closure of licensed platforms and a potential shift of players toward illegal gambling sites.

These unregulated sites currently account for roughly half of Brazil’s iGaming activity. They operate outside the national tax framework and without obligations related to compliance, responsible gaming, or player protection, raising concerns about consumer safety and lost fiscal revenue.