The possible ban of betting companies in Brazil may result in a much higher cost to public finances, as revealed by data compiled by BNLData. According to the Ministry of Planning, the revenue drop could cost the government R$6.8 billion from the end of 2026 to the end of 2027, but there is a more detailed estimate, based on the official data on collection, of R$18.2 billion during the same period.
Planning Minister Bruno Moretti confirmed, in an interview published on October 19 in Valor, the estimate of losses by the government, which includes R$1.5 billion in lost revenue in late 2026 and R$5.3 billion in 2027. He also acknowledged that the government is looking at scaling down betting revenue-related spending as a way to minimise the effect on the federal budget.
The R$5.3 Billion Estimate Covers Only Legal Beneficiaries
BNLData estimates that the government’s R$5.3 billion will mainly be used for programs in the areas of sports, tourism, public security, health, education and social security, among others, under Law No. 14,790/2023. It is not a measure of the overall revenue loss to the Federal government if betting is banned.
The legal beneficiaries received on average R$413.5 million a month in the 12 months ending in June 2026. With the 14% gross gaming revenue (GGR) allocation rate set for 2027 in Complementary Law No. 224/2025, this result is around R$5.3 billion per year.
The government’s estimates also factor in the reduction in betting activity that restrictions in place are expected to make, Moretti explained. But the available data does not indicate such a decrease during the first half of 2026. GGR was R$20.07 billion, an increase of 15.3% compared to the same period of last year, and June saw a monthly record of R$513 million allocated to legal beneficiaries.
Federal Taxes Add Billions to the Potential Loss
The government’s calculation also does not include several revenue streams generated by regulated gambling operators. Federal taxes from the sector, such as the corporate income tax, social contribution on net profit, PIS/Cofins and social security contributions, totalled R$9.95 billion in 2025.
Other sources are: regulatory fees, income tax on betting winnings, and future licensing fees. In 2025, the sector’s inspection fee brought in R$105 million, and operator authorizations brought in R$30 million and will be valid for five years. The end of the regulated market would also preclude future renewals and new licensing revenue, and leave the government vulnerable to compensation claims.
Federal revenues from this sector totaled R$7.284 billion during the first half of 2026. That rate of growth would mean around R$14.6 billion each year, but this is not taking into account changes in the market in the future or the expected rise in the GGR allocation rate.
Cutting Transfers Would Shift the Burden
The government is looking at trimming out expenditure that is tied to the winnings from betting to help soften the blow to the budget. Such a measure would only mitigate transfers to ministries, funds and other legally designated beneficiaries and not change the root cause of the loss to public finances.
The loss of revenue that BNLData projects to be R$18.2 billion between October 2026 and December 2027 is higher than the R$6.8 billion estimate made by the government. The calculation is said to be conservative as it does not include growth in the market or the higher allocation rate planned for 2027.
A financial institution consulted by Valor estimates a lower, but still substantially higher, impact of R$11.2 billion in 2027. The assessment is made under the assumption that part of the money that had been spent on wagering will find its way back into the economy as taxable consumption.
Betting Revenue Adds Pressure to Brazil’s 2027 Budget
The debate is ahead of the government’s plans to make adjustments in the 2027 budget proposal to allow for announced spending measures. The Planning Ministry estimates the overall package would have a R$53.6 billion effect in 2027, with a R$45.7 billion increase in spending and a R$7.9 billion decrease in revenue. Moretti said about R$20 billion would be transferred, with the Planning Ministry estimating the overall impact of the package would be R$53.6 billion, including R$45.7 billion in new spending and R$7.9 billion in savings in 2027.
The Independent Fiscal Institution (IFI), which is attached to the Senate, is projecting a R$86.1 billion deficit for 2027, while the government’s budget proposal calls for a surplus of R$18.6 billion. IFI director Alexandre Andrade cautioned that if the rules for mandatory spending do not change, then there will be less room for discretionary spending, because “cuts would be made first on investment and operating expenses.”
The financial impact of a betting prohibition then is broader than just the money that would be spent on legally accredited beneficiaries. The ultimate effect will be determined by the extent to which any prohibition is implemented, the extent to which existing licenses will be affected, and the potential impact on spending allocation and the government’s ability to compensate for the loss of revenue from the regulated sector.
Source: BNL Data
