The Brazilian Federal Government has introduced measures providing for the reduction of tax incentives established under federal tax legislation, with effect from 2026. The changes will impact a broad range of federal taxes and tax regimes, subject to the exceptions set out in complementary legislation.
The reduction applies to the following taxes:
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PIS/Pasep contributions
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Cofins
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Corporate Income Tax (IRPJ)
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Social Contribution on Net Profit (CSLL)
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Import Tax (II)
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Excise Tax (IPI)
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Employer social security contributions
Considering these taxes, the tax incentives and benefits listed in the Tax Expenditure Statement annexed to the 2026 Annual Budget Law will be subject to reduction, except where exclusions are expressly provided by complementary law.
The measures also apply to specific tax regimes expressly referenced in the legislation, including:
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Presumed Profit regime
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Special Regime for the Chemical Industry
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Presumed IPI tax credits
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Presumed PIS/Pasep and Cofins tax credits
The reduction will take effect on 1 January 2026 for Corporate Income Tax (IRPJ) and Import Tax (II), and on 1 April 2026 for all other affected taxes.
