Brazil's Senate Economic Affairs Committee has approved a significant legislative proposal aimed at increasing taxes on fintechs and online betting companies. The bill, PL 5.473/2025, introduces a phased tax hike designed to bolster federal revenue and address fiscal imbalances. If no appeal is made for a plenary vote, the proposal will now advance to the Chamber of Deputies for further consideration.
A Gradual Tax Hike for Financial and Betting Sectors
The legislation specifically targets the Social Contribution on Net Profit (CSLL) for non-bank financial institutions. For fintechs, payment institutions, and stock exchanges, the tax rate will climb from the current 9% to 12% in 2026, reaching 15% by 2028. This move aims to create greater tax parity within the financial sector, which has been a subject of intense debate.
Online betting operators also face a progressive tax increase on their gross gaming revenue. The current 12% rate will rise to 15% for 2026 and 2027 before settling at 18% in 2028. Officials project this measure will generate nearly $934.5 million in additional revenue in its first year, primarily directed toward social security and healthcare.
Broader Scope and Regulatory Enhancements
Beyond these core changes, the bill expands its fiscal reach by raising the tax on Interest on Own Capital (JCP) from 15% to 17.5%. It also establishes a tax regularization program, offering special conditions for low-income individuals to settle outstanding debts with federal authorities. These provisions broaden the proposal's impact on the country's tax landscape.
A key component of the bill involves strengthening regulatory oversight to combat financial crimes. It mandates semi-annual compliance reports from financial institutions and introduces measures to tackle illegal betting operations and their advertisers. Furthermore, a new Regulatory Compliance Index for Betting (ICRA) will be created to monitor and enforce industry standards.
Political Maneuvering and Legislative Context
This legislative effort revives key aspects of a previous provisional measure that expired without a vote in Congress. The bill's approval comes amid a heated national discussion regarding tax fairness between traditional banks and the burgeoning fintech industry. The government has been actively seeking ways to implement these tax adjustments to balance its accounts.
The committee's session was marked by considerable political drama, with rapporteur Senator Eduardo Braga openly criticizing the Ministry of Finance for a last-minute change in position. The impasse was resolved when Government Leader Senator Jaques Wagner intervened, overriding the ministry's guidance to secure the bill's approval. This move highlighted the complex negotiations underpinning the government's fiscal agenda.
The approval of this comprehensive tax bill marks a critical step in the Brazilian government's strategy to increase public revenue and regulate emerging industries. As the legislation moves to the Chamber of Deputies, its final form will be closely watched by the financial technology and online gaming sectors. The outcome will undoubtedly shape the competitive and regulatory environment for these dynamic markets in the years ahead.