Brazil’s Land-Based Casinos Prepare For Transformative Debate

Brazil’s land-based gambling industry has long operated under a legal framework established decades ago, leaving it in need of modernization. However, a major shift is now on the horizon as the Brazilian Senate prepares to debate a bill that could fundamentally reshape the country’s gambling landscape.

For over two years, the Brazilian Senate has anticipated the debate on Bill 2,234/22, which carries the federal mandate to modernize the nation’s land-based gambling laws. Spearheaded by Senator Irajá Abreu (PSD-TO), the bill aims to replace the outdated 1946 Decree Law imposed by former President Gaspar Dutra, which had banned casinos from operating within the country’s municipalities and districts.

A key aspect of the proposed legislation is the provision that would grant Brazilian states the autonomy to operate gambling venues within their respective jurisdictions. This shift in policy would allow states to establish casinos, bingos, horse racing facilities, and jogo do bicho (instant win games) based on specific criteria, such as population size, socio-demographic factors, and the size and location of the gambling establishments.

Under the new framework, the most populous states in Brazil would be granted the ability to host multiple gambling venues. For instance, the states of Rio de Janeiro, Minas Gerais, Paraná, and Amazonas would be permitted to establish two casino resorts each, while the state of São Paulo would be allowed to have three such properties within its borders.

The bill also outlines a taxation structure for the land-based gambling industry. A provisional tax charge of 17% would be levied on the gross income generated from games and wagers at these venues. Additionally, customers would incur a 20% tax on all prizes and winnings above R$10,000 (approximately €1,600). The revenue generated from these taxes would be allocated to municipal projects focused on promoting tourism, sports, culture, and various social initiatives.

The push for modernizing Brazil’s land-based gambling laws is driven, in part, by the country’s desire to align its policies with the regulatory frameworks of other OECD and G20 nations. As Minister of Finance Fernando Haddad has noted.

Despite the momentum behind Bill 2,234/22, a thorough revision of the proposed modalities is expected. Many of the bill’s provisions were drafted a decade ago by former rapporteur Renato Vianna, and the current legislative landscape may require updated considerations.

The progress of Bill 2,234/22, which focuses on land-based gambling, will be distinct from the imminent launch of Brazil’s federal sports betting marketplace. The sports betting framework, known as Bets, is being overseen by the Ministry of Finance and the Secretariat of Betting and Prizes (SPA), with the licensing process scheduled to commence on January 1, 2025.