Rapporteur increases taxation of betting, fintechs and JCP in bill that plans to reduce tax incentives

The text is expected to be voted on on Tuesday.

The tax increase collection measures were included in the text after a modification of the reduction in advantages granted to companies on the basis of presumed profit. The initial proposal envisaged a reduction in incentives for companies with annual turnover above 1.2 million reais, which raised concerns among parliamentarians about the impact on mid-sized companies. The new text presented provides for a ceiling of R$5 million. As a result, the impact of the inventive cuts increases from 19.9 billion reais to 17.5 billion reais, according to Ribeiro.

• In the case of betting, the tax applied to bookmakers’ gross revenues will increase from 12% currently to 15%, linearly, at a rate of 1 point per year, until 2028.
• For fintechs, the text presented to the Chamber increases the rate of people subject to the CSLL rate from 9% to 12% next year and 15% from 2028. Larger fintechs, with a rate of 15%, would increase to 17.5% in 2026 and 20% in 2028.
• The tax on the distribution of equity interest (JCP) by companies to their shareholders — this is a form of profit distribution used mainly by the financial sector — increases from the current 15% to 17.5%.

The presentation of the text took place after intense negotiations by the government, which went to the field yesterday to request approval of the bill by the National Congress. President Luiz Inácio Lula da Silva summoned the Speaker of the House, Hugo Motta (Republicanos-PB), and the Minister of Finance, Fernando Haddad, to participate in a meeting with the leaders of the House. The head of the economic team stressed that the department needs 20 billion reais to close the 2026 budget, the amount of revenue anticipated in the original version of the text.

Negotiations were moving forward last night to reduce certain points compared to the government’s initial proposal, but compensating by the inclusion of an increase in taxation of betting and fintechs and, possibly, an increase in the tax on the distribution of interest on equity (JCP) from companies to their shareholders.

— The volume of resources needed to close the budget is in the order of 20 billion reais — Haddad told journalists while leaving the Ministry of Finance early yesterday evening.

The economic team is trying to vote on next year’s budget this week, the last week before the parliamentary recess. The project under discussion guarantees the necessary resources to achieve next year’s target, which is a surplus of 0.25% of GDP, or approximately 34 billion reais. Without these resources, the risk that the government would have to contain its spending from the start of the year would increase considerably. The government is playing with the risk of removing parliamentary amendments to try to convince MPs to move forward with these measures.