Potential of a Brazil Regulated Gambling Market

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Sunday, May 7th, 2017 | Written by Adam Brown

Many Latin American countries are currently toying with the idea of legalizing gambling for the very first time, or regulating their online gambling markets in order to provide better protection and freedoms for their citizens. While the potential for the gambling industry is great across much of Central and South America, Brazil could prove to be a particularly profitable country for the gambling industry.

Currently, gambling is almost completely illegal in the vast country of 207.8 million people, and has been since the 1940s. While Brazilian lawmakers have been trying to bring back casino gambling and other forms of gambling for more than 25 years, the country now finally seems to be on the verge of doing so successfully. As gambling analyst Alexandre Fonseca commented last year:

“If you ask me what are the odds of Brazil becoming a global gaming destination within the next five to 10 years, I would say they are quite high.”

Bill PLS 186/2014

The National Congress, the legislative body in Brazil, has been hard at work proposing legislation to expand gambling in the country. The Senate has drafted one especially promising bill, PLS 186/2014, which would allow for land-based and online casinos to open for business in Brazil under licenses issued by the government. In addition, the law would legalize bingo halls, sports betting parlors and a popular lottery style game called jogo do bicho.

According to the original version of the bill, the government would issue a total of 35 casino licenses with a maximum of 70,000 slot machines throughout the country, with all licensees required to offer restaurants and retail stores, in addition to their gambling facilities. Bingo halls would also be permitted at a ratio of one license per every 150,000 people in any particular city or municipality, while internet gambling would be legalized, regulated, and taxed accordingly.

PLS 186/2014 received plenty of attention during 2016 when lawmakers openly debated it on the floor of the Senate, with the Special Committee for National Development eventually passing the bill. However, it was never brought to a full vote in the Brazilian Senate, and unfortunately, 2016 closed out without the bill becoming law, meaning that Brazil will need to start fresh in 2017.

Considerable Opposition

Those familiar with politics in the country report that while there is major support for legalizing gambling, there is also considerable opposition. Some lawmakers argue that legalizing gambling would only lead to people who are already living in poverty falling deeper into despair and that incidences in gambling addiction would increase to unbearable levels.

“It’s very easy to think about taxes going to the public coffers. It’s forgetting how many families will lose, will be destroyed by those who.. take everything they have and play at the casinos,” warns Congress member Pastor Francisco Eurico da Silva.

These arguments are familiar and have been heard time and time again while other countries have moved forward with gambling regulation laws.

$17.6 Billion Industry

Currently, it is believed that Brazilians spend more than $6.4 billion on illegal gambling every year. Legalizing gambling in Brazil would mean that this money was fairly taxed and that national and local governments would have a steady source of revenue to support social programs and fund other line items in their budgets. This would be a major win for the country that has been financially strapped for some time.

Industry analysts believe that once gambling is regulated and legalized, Brazilians could potentially spend $17.6 billion on gambling every year. With Rio de Janeiro being a major vacation destination, tourist dollars would boost that figure even further. With over 200 million people in Brazil, legalization would make it the largest regulated gambling jurisdiction in the world. Sports betting would likely be one of the most popular forms of gambling due to the country’s love for soccer; however, industry analysts think that casinos could also do well in many parts of the country.

The industry would also help provide employment for tens of thousands of Brazilians across the country, as back in 1946 when the industry was shut down around 40,000 Brazilians suddenly found themselves without work. Furthermore, money spent by Brazilians would stay within their own country, rather than in places such as neighboring Argentina which has been a major beneficiary of Brazil’s lack of gambling legislation.