Overview

• The Chamber of Deputies pulled the IOF-related provisional measure from the agenda on its final day, causing it to lapse without a vote.
• The lapse exposes an estimated R$46 billion shortfall through 2026 after lawmakers had already diluted planned taxes on bets and LCIs/LCAs.
• Government figures discuss blocking up to R$10 billion in parliamentary amendments, and Lula signaled a push to tax fintechs, with decisions expected after a meeting with Finance Minister Fernando Haddad next week.
• The Senate’s Independent Fiscal Institution projects 1.7% GDP growth and 4.3% inflation for 2026 versus the government’s 2.4% and 3.6%, pointing to overstated revenues and higher indexed spending.
• Political messaging has hardened against Congress and high-income taxpayers, and while allies note the Supreme Court has upheld executive authority to raise IOF, editorials warn such a move would likely intensify conflict with legislators.