The legislative caucus of Brazil’s Workers’ Party (PT) has filed a bill proposing an outright federal ban on online gambling, escalating campaign rhetoric into formal legislation that would dismantle the regulatory framework built by the same government – and putting billions in tax revenue at risk ahead of October’s presidential election.
Bill Details: Full Repeal of Bets Law
Deputy Pedro Uczai (PT-SC) submitted PL-1808/2026 to the Chamber of Deputies on Tuesday, backed by 68 PT lawmakers. The bill calls for the complete repeal of all laws governing online betting introduced under Brazil’s Bets Law, the regulatory regime that took effect on January 1, 2025. The proposed prohibition extends across the entire gambling framework, banning “the exploitation, operation, offering, availability, promotion, advertising, intermediation and processing of transactions related to fixed-odds betting” throughout national territory. Penalties would include fines of up to two billion Brazilian reais (approximately $385 million) and prison sentences of two to eight years, with aggravated penalties for cases involving minors or criminal organizations. Platforms with more than one million users would be required to remove gambling promotional content.
Political Calculus: Lula's Silence
The bill carries no signature from President Luiz Inácio Lula da Silva or senior members of the federal government. Lula said last week that he would shut down online betting if it were solely his decision, telling ICL Notícias on April 8 that he could not accept “this uncontrolled gambling” continuing. But he acknowledged the decision required congressional action and that the betting industry’s financial ties to lawmakers made the political math uncertain. A full repeal would place the PT on a collision course with its own fiscal strategy. The Receita Federal collected 2.5 billion reais in gambling-related tax revenue in January and February 2026 alone – a 236 percent increase over the same period last year. That revenue underpins the social and welfare programs at the center of Lula’s reelection platform.
Crypto Implications: Offshore Shift Likely
The crypto implications are direct. Brazil already bans cryptocurrency deposits on licensed gambling platforms under the existing regulatory framework. A full repeal would eliminate even that regulated structure, leaving no legal framework and historically pushing activity to unregulated offshore operators where crypto is the default payment method. The bill’s own text defines its scope as covering all “processing of transactions” linked to gambling – language broad enough to encompass any payment rail, including digital assets. This could accelerate a trend already observed in Latin America: when domestic regulations tighten, gamblers migrate to crypto-friendly jurisdictions with weak oversight, often using stablecoins or privacy coins.
Industry Pushback and Election Context
The national industry trade body ANJL called the proposal “a great risk,” arguing that the regulated framework was specifically designed to bring unregulated activity into a controlled environment. Uczai framed the bill as an emergency public health measure, stating that betting had moved beyond entertainment and become “a mechanism for capturing popular income.” Brazil’s October 2026 general election looms over the debate. The bill aligns with the PT’s “3B” campaign slogan targeting bankers, billionaires, and betting, but political expectations had pointed to tighter regulation rather than full dismantlement. Whether Lula and the party leadership endorse the bill directly or let it serve as campaign positioning remains the central question. The outcome will also set a precedent for how other emerging economies balance gambling revenue, public health concerns, and the rise of cryptocurrency in unregulated markets.