Brazil: Senator Demands Urgent Oversight of Online Betting and Criticizes IOF Increase

Senator Izalci Lucas denounces lack of control over electronic betting

Brazil.- July 4, 2025 www.zonadeazar.com  Senator Izalci Lucas (PL-DF) demanded on Tuesday (2) increased oversight of Brazil’s online betting sector, warning that the government has yet to take effective measures to regulate the activity.

According to Izalci, the lack of supervision by the Central Bank, Treasury Secretariat, and Ministry of Economy allows illegal betting operations to send funds abroad without paying taxes, causing a loss of BRL 300 billion in 2023.

“The Central Bank does not control payment entities”

“The Central Bank does not exercise any control or supervision over payment entities. Many illegal entities send funds abroad without paying a cent, representing over BRL 30 billion a year. The Central Bank itself has acknowledged it lacks the means to supervise these entities. We propose a change, and I hope the government will implement it as soon as possible,” stated the senator.

Criticism of sudden IOF tax increase

The senator also criticized the increase of the Financial Operations Tax (IOF), stating that the government violated the annuality principle of the Tax Code by raising the tax by up to 300% without prior notice.

“You can’t increase a tax overnight”

“The IOF is not a revenue-raising tax. You can’t impose it on businesses or individuals without planning. The law is clear: the annuality principle must be respected. You can’t raise a rate by 300% overnight just to cover a fiscal deficit,” Izalci explained.

Context: betting regulation in Brazil

Brazil is at a pivotal moment regarding the regulation of sports betting and online gaming, with a growing market generating discussions on tax collection, capital flow controls, and industry integrity measures.

Source: Agência Senado (Authorized reproduction with citation of Agência Senado)

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