Spending on sports betting on platforms onlineto the betsis impacting the consumption of goods and services, especially among socioeconomic classes with lower purchasing power, and affects the perception of improvements in the Brazilian economy, such as increased income, employment growth and inflation control.
The assessment is from the company PwC Strategy& do Brasil Consultoria Empresarial Ltda, linked to the multinational auditing and advisory firm PricewaterhouseCoopers. According to economist and lawyer Gerson Charchat, partner and leader of Strategy& do Brasil, spending on sports betting “already exceeds other types of discretionary expenses, such as leisure, culture and personal products, and is even starting to impact the budget allocated to food. This diversion of resources to betting puts considerable pressure on the demand for essential products, affecting the dynamics of the economy in general.”
Sports betting on platforms exploded in Brazil after the Law No. 13,756 be approved by the National Congress and sanctioned by then President Michel Temer at the end of 2018. From that year to 2023, spending on betting increased by 419%.
“In 2018, gambling represented 0.27% of the family budget of classes D and E; today, this percentage has jumped to 1.98%, almost four times more than five years ago. On the other hand, spending on leisure and culture decreased from 1.7% to 1.5% of the budget, while spending on food remained stable”, says Charchat in an interview with Brazil Agency.
He warns that sports betting has grown significantly and has become a significant source of spending, especially among young people from lower-income social strata. “This phenomenon could even lead to an increase in debt among the low-income population, which could have a negative impact on the country’s economic growth.”
Strategy& Brazil’s published analysis, based on secondary data, indicates that the population’s perception of financial difficulties grew by five percentage points between 2022 and 2024. Today, one fifth of Brazilians say they face difficulties paying their bills every month, or are unable to pay them most of the time.
Compromised income
There is no precise information about the number of companies that manage platforms in Brazil or the amount of money raised in the business. These numbers will only be known after the bets obtain authorization from the Ministry of Finance for the commercial exploitation of the fixed-odds lottery modality, and begin collecting taxes.
The impacts and effects on the economy had already been pointed out by the Brazilian Society of Retail and Consumption (SBVC). According to an opinion poll conducted for the entity in May, among those who gamble, 64% recognize that they use part of their main income to try their luck; 63% state that they have had part of their income committed to gambling. online; and 23% stopped buying clothes, 19% supermarket items, 14% hygiene and beauty products, 11% health care and medications.
For economist Ione Amorim, consultant for the financial services program at the Consumer Defense Institute (Idec), “the problem has escalated” and in addition to the economic dimension, there are errors in regulation, social effects and the mental health of the population that have not been estimated.
“Today we already have a reality of suicide, destruction of homes, debt, people who have already lost their jobs because they have already lost everything they had. Extremely serious mental illnesses due to these addictions, which lead to another, that is: the person gets into debt, and if they lose, goes from gambling to alcohol, from alcohol to drugs and to suicide”, describes Ione Amorim, who has already given lectures on the impacts of online gambling even in the Armed Forces.
In the economist’s assessment, the social situation and misinformation make the poorer public more vulnerable to taking risks when betting.
“We have a population with a low level of financial education. People already have difficulty dealing with their reality, spending within their income.”
For her, the socioeconomic situation of some families leads to debt to ensure survival, and betting becomes an attractive risk to, occasionally, obtain resources and settle commitments.
But, according to Ione, it is necessary to be careful: “easy gains will lead the person to an environment where there may be significant losses”, highlights the economist who also points out that bets are intermediated by systems with algorithms.
“You are playing against a machine that has been programmed. So you will win eventually, but you will lose much more than you win.”
PL 2234
Ione Amorim adds that the economic, social and mental health effects caused by electronic sports betting platforms on online platforms may be enhanced with the approval of the Bill No. 2,234/2022currently being processed in the Senate, which authorizes the operation of casinos, bingo halls, animal games and betting on horse races throughout the national territory.
The approval of the PL, as well as the law that authorized betting on betsis defended by the possibility that businesses generate employment, income and taxes that can fund social policies. In the case of electronic platforms, in operation for five years, not a single real has been collected.
Collection will begin after authorization for commercial exploitation by the Ministry of Finance. The authorization will be granted, after technical and legal evaluation, upon payment of R$30 million to the Union. The deadline to obtain the permission is until the end of the year.
The revenue accounting of those who defend the legalization of gambling does not deduct the losses in taxation that are occurring in other sectors amid the growth in spending on gambling and also does not measure the increase in state spending on public security and mental health care.
Report by Brazil Agency It addresses the sector’s potential and good practices, but warns of the risk of dependency. Read here.
