By Marcela Ayres and Bernardo Caram
BRASILIA (Reuters) – Brazil’s government will propose a 10% tax on corporate profits and dividends sent abroad to help offset revenue losses from raising the income tax exemption threshold to 5,000 reais per month for individuals, two sources with knowledge of the matter told Reuters on Monday.
The measure by President Luiz Inacio Lula da Silva’s administration will complement a previously announced minimum tax on individuals earning more than 600,000 reais ($105,503) per year. Those rates would gradually increase to a maximum of 10% for those making over 1.2 million reais annually, said the sources. That’s above an initially announced threshold of 1 million reais.
The government estimates the broader income tax exemption on individuals will have a fiscal impact of 25.84 billion reais ($4.54 billion) in 2026, 27.72 billion reais in 2027, and 29.68 billion reais in 2028, they added.
The government has scheduled the official income reform tax bill presentation for Tuesday at 11:30 AM local time.
($1 = 5.6870 reais)
(Reporting by Marcela Ayres and Bernardo Caram; Editing by Christian Plumb)
