IBJR Warns: 50% Tax Hike in Brazil’s Betting Sector May Fuel Black Market Growth

The Brazilian Institute for Responsible Gaming (IBJR) has issued a strong warning that a proposed 50 % increase in tax rates for licensed betting operators risks driving bettors toward unregulated markets.

Under Provisional Measure MP 1,303/2025, the effective gambling tax rate on gross gaming revenue (GGR) would rise from 12 % to 18 %. IBJR argues this jump, occurring only months into Brazil’s regulated betting era, could erode trust, deter investment and undermine the licensed sector.

According to IBJR, the illegal betting market already constitutes roughly 50 % of all bets in Brazil, and the new tax could push that share even higher — with estimates suggesting a rise to 60 % or more. The group cautions that consumers migrating to black market platforms would lose regulatory protections, while the state would lose tax revenue.

The IBJR has also criticized the timing and abruptness of the tax increase, stating it creates legal uncertainty for operators who entered under the previous regime. They advocate for prioritizing enforcement against illegal betting rather than imposing heavy tax burdens on the regulated market.

As Congress prepares a vote on MP 1,303, IBJR is calling on legislators to consider the long-term stability and credibility of Brazil’s betting market before approving the change.