R$ 96.1 million. That is the loss Brazil's public coffers may have suffered from a single betting site, Blaze, which is at the center of a Finance Ministry investigation into 14 online betting platforms for underreporting revenue, Folha de S.Paulo reported.
In practice, that is money that never reached federal taxes or the so-called social allocation, the 12% slice of gross betting revenue that Brazilian law earmarks for areas such as health, education and sports. Two civil servants interviewed on condition of anonymity detailed the case of Blaze, a platform once promoted by footballer Neymar Jr. and influencer Virginia Fonseca.
The math starts with revenue. Blaze declared gross revenue of R$ 1.9 billion and deducted R$ 477 million as "withdrawable bonuses", promotional credits offered to registered players. It is as if, for every R$ 100 that came in, the company told the tax authority that R$ 25 were off-limits.
What are withdrawable bonuses
A withdrawable bonus is a promotional amount the player can cash out at any time. A Finance Ministry technical note from January 2025 allows betting companies to deduct this kind of bonus from gross revenue before taxes are calculated. Bonuses that only work inside the platform, like a discount coupon, must be booked as marketing costs and remain taxable.
The problem, according to the investigation, is that Blaze's own pages showed conditions for withdrawals: players had to bet roughly 35 times the value of the benefit before cashing out. Four betting industry executives interviewed anonymously by Folha said such amounts could not be treated as withdrawable bonuses.
With the deduction, Blaze's declared revenue fell from R$ 1,903,187,065.35 to R$ 1,425,892,218.93. The social allocation may have come in R$ 57 million short, and the Federal Revenue Service estimates a drop of R$ 31.9 million in Cofins and R$ 6.9 million in PIS, two federal taxes levied on corporate revenue.
What the companies and the government say
In a statement, Foggo Entertainment, which holds the rights to the Blaze brand in Brazil, said it calculates gross revenue "in compliance with current regulation" and remains available to authorities for any clarification. The company declined to comment on specific figures from its financial statements.
Another company under investigation is RR Participações, owner of MultiBet and Ricobet, controlled by Ricardo Rezende Soares de Oliveira, a businessman from Minas Gerais with interests in lottery outlets. The company did not reply to Folha's requests, and the newspaper could not estimate the losses in that case.
The Secretariat of Prizes and Betting (SPA), the Finance Ministry arm that oversees the sector, said ongoing inspections are kept under seal. The fines regime, which can reach R$ 2 billion per company, more than 20 times the estimated loss in the Blaze case, remains in force even after President Lula's ban on betting sites.
That ban came through a provisional decree last month and took the platforms offline for 120 days; Blaze went dark on the 6th. Congress must ratify the measure before it expires, and lawmakers are negotiating a middle ground instead of a full prohibition.