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2h ago

Brazilian Senate Approves Income Tax Overhaul Raising Exemption to R$5,000

The bill now awaits Lula’s signature to take effect in 2026 under the annuality rule.

STF atendeu pedido do PSOL par imposto sobre grandes fortunas. Fux criticou partidos que perdem na política e buscam solução no Judiciário.
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Alcolumbre afirmou que a isenção do IR “dialoga com a vida real das pessoas” e elogiou a atuação de Calheiros como relator.
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Overview

  • Senators passed the measure unanimously on November 5, preserving the text from the Chamber of Deputies to avoid sending it back and to keep the 2026 start date on track.
  • The reform grants full exemption for monthly incomes up to R$5,000 and applies a phased reduction for earners between R$5,000 and R$7,350.
  • Offsets include a minimum effective income tax for high earners, phased from R$600,000 a year to 10% at R$1.2 million, and a 10% levy on dividends above R$50,000 per month as well as on dividends remitted abroad.
  • A separate bill to raise taxes on bets, fintechs and parts of the financial sector was postponed for later debate as an additional compensation measure.
  • The law requires the Executive to propose within one year a policy to update IR table values and excludes returns from instruments such as LCI, LCA, CRI, CRA, Fiagro and incentivized infrastructure debentures from the high‑income minimum tax base.