Brazil Senate Sets Votes This Week on R$5,000 Income‑Tax Exemption

Overview

• Senator Renan Calheiros released a report with only editorial changes to the Chamber-approved text and scheduled a CAE vote for Tuesday, followed by a plenary vote on Wednesday.
• The plan aims for presidential sanction and publication by December 31 so the new brackets take effect on January 1, 2026, with Congress having already lifted the five‑year limit on IR changes in the LDO.
• The bill raises full exemption to monthly incomes up to R$5,000 and grants a partial discount up to R$7,350, after passing the Chamber with 493 votes in favor.
• The Finance Ministry told Renan the package is fiscally neutral or tending to neutrality, though the IFI estimates a R$1 billion annual loss and the Senate consultancy projects roughly R$4 billion.
• Renan advanced a separate bill to raise taxes on bets, banks and fintechs—doubling the levy on betting to 24% and increasing CSLL rates—with projected revenues of R$4.98 billion in 2026 and R$18.04 billion through 2028, as the Chamber also approved up to R$5 billion a year in defense outlays outside fiscal targets.