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A compound assignment expression of the form E1 op= E2 is equivalent to E1 = (T)((E1) op (E2)), where T is the type of E1, except that E1 is evaluated only once.

It says (in the section that Henry referenced) that:
is equivalent to

It's this cast (implicit, because it's added automatically) that makes the difference. Any arithmetic operation between two integer types that are smaller than int results in an int. So a cast is needed to be able to assign it back to a byte.

A compound assignment expression of the form E1 op= E2 is equivalent to E1 = (T)((E1) op (E2)), where T is the type of E1, except that E1 is evaluated only once.