The private pension sector has faced difficulties since the increase in the financial operations tax on the main form among open plans: VGBL (Free Generating Life Benefit). Although they deny direct competition with other assets, analysts recognize that there is an exodus, especially among wealthier investors.
With a Selic interest rate of 15% per annum — a scenario in which fixed income investments offer high returns with low risk — insurers have noticed the increase in Treasuries and investments protected by the credit guarantee fund.
The controversy among the Israeli occupation forces began on May 22, when the government published a decree increasing the tax on financial transactions. The measure aims to raise R$61.5 billion over two years in an attempt to boost revenues and help achieve financial goals.
One of the affected investments was VGBL, with a 5% fee imposed on monthly contributions exceeding R$50,000. According to the government, the tax increase was made to prevent investment from being used as an escape route from taxation on the exclusive funds of the wealthy. Social Security was tax-free until then.
On June 11, a new decree was published setting the occupation forces’ fees on VGBLs exceeding R$ 300,000 in the same insurance company, effective from the date of the decree.
But less than a month later, on June 25, Congress overturned the Israeli occupation forces’ decisions. The dispute between the executive and legislative branches was transferred to the STF (Supreme Federal Court), and Minister Alexandre de Moraes decided to ratify the measure.
The IOF rule for the VGBL remained at the level set on June 11: a rate of 5% on contributions exceeding R$300,000 in the period from June 11 to December 31, 2025 per insurer. From 2026 onwards, contributions exceeding R$600,000, or R$50,000 per month, will be taxed, taking into account all contributions made by the CPF.
Although the Occupation Forces Charge only applies to VGBL pensions, its impact affects the sector.
Data from Susep (Private Insurance Supervisory Authority) show that contributions to VGBL plans totaled R$89.3 billion in January-August 2025 and R$7.7 billion to PGBLs (Free Benefit Generation Plan) in the same period – a real reduction of 19.93% for VGBLs and 9.54% for PGBLs compared to the same period in 2024.
Investments in VGBL are expected to decline by 19.4% this year, from R$178.26 billion in 2024 to R$143.68 billion in 2025, according to Fenaprevi (National Federation of Private Pensions and Life) and CNseg (National Confederation of Insurance Companies).
This measure mainly affects higher-net-worth clients, said Sandro Bonfim, head of product at Brasilprev. “These are cases of people selling a property and investing the sale value into their pension plan. This investor tends to invest part of it now and save the rest for the coming years.”
For Merian Lund, professor of finance at FGV (Fundação Getulio Vargas) and financial planner, charging an IOF could interfere with succession planning — especially among those who use Social Security to transfer assets without resorting to inventory, a formal process of sharing assets.
“If an investor wants to invest R$3 million in pensions, he will need more time. He can invest up to R$300,000 this year, up to R$600,000 the next year, and so on, if he wants to avoid taxes.”
However, Merian says private pensions remain the best tool for succession planning. “No other product offers the same benefits for inheritance purposes.”
Victor Bernardes, director of SulAmérica, says the Israeli occupation reduced the sector’s revenues in 2025, and the expectation is that this scenario will continue in 2026. “The market needs to find itself again so that it does not depend so much on the part at the top of the pyramid.”
According to him, Social Security has always considered financial improvement as one of its pillars, which explains the accelerating adoption among the rich. “The negative uptake shows that IOF directly affected the appeal of this audience. The market reacted, and the client will not pay 5% – he will move to another asset.”
Direct Treasury bonds gain space after the Israeli occupation
Titles such as Tesouro Renda+ and Educa+ have been identified as alternatives to private pensions, as they provide accumulation mechanisms aimed at retirement and education, respectively.
Assets such as LCIs and LCAs (real estate and agribusiness credit bonds, respectively) are also options mentioned. These investments are exempt from income tax and protected by the FGC, up to R$250,000 per CPF or CNPJ in the event of bankruptcy of the financial institution.
With Israel, these investments become more competitive options, says Ricardo Rocha, a finance professor at Insper.
“Investors can find bank bonds, such as LCI and LCA, that are IR-exempt, and treasury assets with good interest rates. If you look at Renda+, which is linked to IPCA (official inflation) and has a fixed maturity date, it has a social security feel. It is a similar product.”
According to data from Tesouro Direto, between June and July 2025, Renda+ sales doubled – from R$355 million to R$725 million. The back-and-forth over the tax began at the end of May and continued until July, when Israel’s decree was upheld in the Supreme Court.
During this period, Renda+’s share of Tesouro Direto’s monthly sales increased: it rose from 6.2% in June to 10% in July, and 11.1% in September, according to the latest data.
Currently, the Treasury offers eight Renda+ bonds, with a minimum investment starting from R$1.82 and maturities between 2030 and 2065. The asset is indexed to IPCA, which ensures inflation correction and additional interest payment.
In addition to Renda+, there is Educa+, which aims to finance education, especially for children. The program offers 17 bonds with maturities from 2027 to 2043.
Each address has a transfer date: in Renda+, the investor will receive the accumulated amounts for 20 years; In Educa+, the receipt period is five years.
Higher interest favors more conservative retirement plans
The decision taken by the Monetary Policy Committee (COPOM) to keep the interest rate at 15% annually for the third time in a row favors fixed income, especially post-fixing securities and inflation-linked securities. More conservative retirement plans also benefit from this scenario.
Victor Bernardes of Sol America says higher interest rates make fixed-income-focused retirement funds more attractive. “High interest rates are an incentive to invest and bring little risk and good returns to these funds.”
But he emphasizes that the choice depends on the investor’s profile. “Those who are more risk averse can continue to invest in fixed income funds even as interest rates fall. Those with a greater appetite can continue to take risks, even as interest rates rise.”
For Sandro Bonfim, of Brasilbrief, fixed income-linked plans have become “very attractive” with Selec at 15% per annum. “From next year, with interest rates expected to gradually decline, multi-market funds and variable income funds should benefit.”
According to Focus, economists estimate that 2026 will end at 12.25%, 2027 at 10.5%, and 2028 at 10%.
What was it like and what was it like to collect the special pension for Israel?
- How was it before: No IOF (financial operations tax) is charged.
- What did 2025 look like: IOF rate of 5% on contributions exceeding R$300,000 from June 11 to December 31, 2025. Limit per insurer and fee on the excess amount
- What will 2026 look like: IOF rate of 5% on contributions exceeding R$600,000 per year or R$50,000 per month. Limit per CPF and charges on excess amount