Brazil’s Congress to discuss higher tax rate as operators warn that it could cost the government R$ 2.8 billion
On Tuesday (15), the mixed commission responsible for analysing the provisional measure regarding the taxation of financial investments and virtual assets (MP 1.303/2025) was installed. The measure was forwarded to the National Congress in June to compensate for the revocation of the increase in the Tax on Financial Transactions (IOF). Senator Renan Calheiros was elected president of the committee, and Deputy Carlos Zarattini will serve as the rapporteur of the proposal.
According to the Senate News Agency during the meeting, the commission scheduled four public hearings to be held in August to deepen the discussion on the main points of the MP. The first, set for August 7, will include a representative from the Ministry of Finance. The remaining hearings will address the taxation of currently exempt assets and instruments, the increase in the Social Contribution on Net Income (CSLL), taxation on bets, and the fishing insurance for fishermen.
The announcement comes as representatives of the sports betting and online casino industry in Brazil are preparing a report to present to Finance Minister Fernando Haddad. The document, driven by the National Association of Games and Lotteries (ANJL), warns that the country could lose more than R$ 2.8 billion if the tax on the sector is increased from 12 per cent to 18 per cent. According to estimates from ANJL, the biggest impact would be on concession fees, with projected losses of R$ 2.4 billion, as many operators would choose not to enter the Brazilian market. This would be complemented by a reduction of R$ 400 million due to deposits in federal public securities that companies would need to make as part of the legalization process.
However, the government’s leader in Congress, Senator Randolfe Rodrigues, emphasized the importance of the MP for reducing social inequalities in the country.
“We are today one of the ten (largest) economies in the world and, at the same time, one of the ten most unequal countries. Something is not right with this combination. The government has sought, with this provisional measure, to build mechanisms of tax justice,” he said.
The schedule proposed by the presidency of the commission foresees the voting of the matter in the committee on August 26. The MP will lose its validity on October 9 and must be voted on by the National Congress by that date.
Issued on June 11, MP 1.303/2025 is part of the federal government’s effort to balance public accounts following the repeal of decrees that increased the IOF. The text provides, among other points, for the standardization of the Income Tax rate at 17.5% for various financial applications and crypto assets, and a 5% tax on income from investments that are currently exempt. There is also an expansion of the tax burden from 12 per cent to 18 per cent on the Gross Gaming Revenue (GGR) of sports betting and online games.
