Congress Debates Key Changes In Brazil’s IOF Bill

Brazil.– 9 October 2025 – www.zonadeazar.com The Provisional Measure 1303/2025, revising the Financial Operations Tax (IOF) and related levies, has undergone major amendments and was expected to be voted today by Brazil’s National Congress.

Overview

The proposal seeks to modernise the tax system and expand federal revenue while balancing fiscal responsibility with market growth.
Political negotiations intensified after resistance from business associations and fintech sectors that warned of excessive taxation.

Finance Minister Fernando Haddad emphasised that “the government’s priority is a fair and sustainable tax model that supports innovation and transparency.”

Details / Context

Rapporteur Carlos Zarattini (PT-SP) secured committee approval by 13–12 votes.
Key points of the final text include:

  • Maintaining an 18 % Income Tax on financial investments and interest on equity.
  • Removing the reduced CSLL rate for fintechs.
  • Restoring income-tax exemptions for LCI, LCA, LCD, CRI and CRA securities after industry pressure.
  • Withdrawing the plan to raise sports-betting tax from 12 % to 18 % of GGR.
  • Creating a special regime, RERCT “Zero Litigation Bets”, requiring companies to regularise undeclared funds with a 15 % retroactive tax.

The Treasury lowered its 2026 revenue forecast from R$ 20 billion to R$ 17 billion following these changes.

Subtopic: Political And Market Reactions

The government delayed the plenary vote to secure support across party lines.
While business leaders hailed the measure’s adjustments, critics argued that it reduces short-term fiscal capacity.

For the iGaming sector, maintaining the current GGR tax is seen as a positive signal of stability, protecting operators from unexpected burdens while keeping regulatory revenue steady.

Future Outlook

If approved before expiry, the MP 1303/2025 will mark a step toward comprehensive tax reform and greater integration of the digital economy.

Analysts predict that the RERCT programme could generate significant one-off revenue, but warn of legal uncertainty over retroactive taxation.

The Brazilian debate will serve as a reference for Latin America, highlighting how emerging markets can combine fiscal discipline and innovation.

Zona de Azar, the leading global iGaming news source, will continue to monitor the Congressional vote and its impact on the industry.

🔗 Edited by: @_fonta www.zonadeazar.com

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