Brazil Weighs Online Casino Ban as Lula Targets Gambling Weeks Before Election

Brazil’s newly regulated online gambling market could be partially dismantled barely a year after the government finished licensing it.

President Luiz Inácio Lula da Silva’s administration is preparing an executive order that would prohibit online casino games while leaving sports betting legal, according to people familiar with discussions inside the presidential office. Lula is expected to settle the final language before Brazil votes in the first round of its general election on October 4.

The distinction matters. Sports wagers would survive under the proposal, as would sponsorship agreements involving teams and competitions. But casino games represent the larger share of business for many licensed operators. Brazil’s National Association of Gaming and Lotteries estimates that roughly three-quarters of industry revenue comes from gambling products outside sports betting.

That leaves the government contemplating an unusual regulatory reversal: companies paid for licenses covering both activities, built businesses around those permissions and could now lose access to their biggest source of revenue.

A Market Brazil Only Recently Regulated

There are 188 authorized betting operators in Brazil. The licensing system itself is recent. Fixed-odds sports wagering became legal in 2018, but Brazil did not complete the regulatory and licensing framework until 2024, during Lula’s current administration.

The financial exposure is substantial.

Licensing fees and gambling taxes brought the federal government almost 10 billion reais, or roughly $1.95 billion, in 2025. Government officials recognize that stripping casino products from licensed companies would reduce tax receipts and could also squeeze the money operators spend sponsoring Brazilian sports.

Industry Warns of a Legal Fight

The industry sees another potential cost: litigation.

Bernardo Cavalcanti Freire, legal adviser to the National Association of Gaming and Lotteries, has argued that operators paid concession fees for permission to conduct activities that included online casino games. If the government later removes part of those rights, companies could seek refunds and damages.

The association’s preliminary calculation puts potential compensation claims as high as 120 billion reais. That figure comes from the industry and has not been established as a government liability.

The dispute could therefore move beyond whether Brazil should allow online casino gambling. Companies may challenge whether the state can sell licenses covering an activity and then withdraw that permission before those licenses have run their course.

Gambling Moves Into the Election Campaign

The political timing is difficult to separate from the policy debate.

Lula has repeatedly pushed for tighter restrictions on internet gambling and has recently held meetings within the government and with civil society over the issue. His position has moved toward ending betting, although discussions among ministers over exactly how far to go have continued. Several of his opponents on the right have also attacked online gambling during the campaign.

Brazil heads into the October 4 vote with a closely contested presidential race. Recent surveys have produced differing narrow numerical leads in hypothetical runoffs between Lula and Senator Flávio Bolsonaro.

Household Debt Adds Pressure

Gambling sits inside a broader economic problem that has become increasingly visible during the campaign: household debt.

The Finance Ministry estimates Brazilians spend about 60 billion reais each year on betting. Banks and industry organizations have also pointed to signs that gambling expenditure is competing with ordinary consumption and household bills.

Lula’s government has already introduced measures intended to reduce excessive indebtedness, but betting expenditure has continued to grow.

The administration is simultaneously putting more money into household budgets. This week it announced a 15% increase in the minimum Bolsa Família welfare payment, taking it from 600 reais to 691 reais a month, while developing another program aimed at helping heavily indebted consumers clear old obligations.

The welfare increase is expected to cost 5.8 billion reais this year and 22 billion reais in 2027, with the government maintaining that the additional amount can be absorbed within existing budget allocations.

Billions in Revenue — and Sponsorship Money — at Stake

The casino proposal cuts across several pressures at once.

The government is considering restrictions aimed at gambling-related financial harm without necessarily eliminating sports betting. At the same time, it has to account for a regulated industry that has already paid for government authorization, tax revenue that has become significant and a sports economy that has grown accustomed to betting-company sponsorship.

For licensed operators, the central issue is no longer simply tighter regulation. It is whether the Brazilian government can substantially narrow permissions it sold only recently — and what financial consequences could follow if companies successfully challenge that decision.

The executive order was still being discussed among ministers as of September 17. Lula had not yet signed the final text.

Brazil Weighs Online Casino Ban as Lula Targets Gambling Weeks Before Election

A Market Brazil Only Recently Regulated

Industry Warns of a Legal Fight

Gambling Moves Into the Election Campaign

Household Debt Adds Pressure

Billions in Revenue — and Sponsorship Money — at Stake

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