Digital Robin Hood: Boulos wants to create a “big tech Pix” and share the proceeds with users

Congressman Guilherme Boulos (Psol-SP) wants to create a new tax on large technology companies operating in Brazil, and proposes distributing part of the revenue to users, whose data is used by so-called big tech companies.

Dubbed the "Big Tech Pix," the Digital Social Contribution (CSD), according to the congressman, would have the function of correcting the concentration of economic power, guaranteeing data privacy, and ensuring that Big Tech contributes proportionally to the country's development.

In his justification, the congressman states that "the supplementary bill aims to correct the concentration of economic and political power in the hands of large digital economy companies, such as Google, Meta, and X (formerly Twitter)." He asserts that the practices of these companies "have posed serious risks to national sovereignty and democracy."

The measure evokes a kind of digital Robin Hood. According to an expert interviewed by Gazeta do Povo , it is a populist proposal aimed at strengthening the federal government.

Big Tech's Pix is ​​aligned with the government's discourse

Boulos' proposal corroborates President Luiz Inácio Lula da Silva's (Workers' Party) stance on the issue. The president has already stated that, in Brazil, companies must follow national regulations, regardless of their country of origin.

This Tuesday (23), in a speech at the UN General Assembly, Lula once again stated that "the internet cannot be a lawless land", and said that regulating does not mean limiting freedom of expression, but ensuring that what is illegal in the real world is treated that way in the digital environment.

Last Wednesday (17), Lula sent to the Chamber a project prepared by the Ministry of Finance that deals with the "economic and competitive regulation" of large technology companies. The idea, according to the government, is to create "new mechanisms to prevent the abuse of economic power by large digital platforms".

An organization called the Digital Council, which represents big tech companies in Brazil, has already stated that the Executive's proposal increases costs and tends to restrict innovation. The organization cites increased spending and technological delays that would have been caused by similar legislation in the European Union.

Trump administration comes to the defense of big tech

Lula's recent statements on the topic are a response to the stance adopted by Donald Trump, President of the United States. He has defended big tech, opposing fines and regulatory attempts by other countries and the European Union against companies like Google, Apple, and X.

In early September, after Google was fined by the European Union, Trump stated that his administration will not allow "discriminatory practices" against American companies to continue. He also stated that he may open a Section 301 investigation to "undo unfair sanctions" against these companies.

Big Tech's Pix could intensify US sanctions against Brazil

Fernando Canutto, an expert in international business law and partner at Godke Advogados, states that there is a significant risk of Brazil facing new sanctions if projects like Boulos's are approved. He believes the United States has been steadfast in defending its technology companies, even against more aligned allies, such as European countries.

"The creation of a contribution of this nature could generate more diplomatic friction and even questions in international trade forums. In a scenario where bilateral relations are already facing trade tensions, the measure could be seen as hostile to American Big Tech companies," he noted.

Movement for regulation occurs throughout the world

Lawyer Marcelo Teske, partner at Bornhausen & Zimmer Advogados, states that Boulos's project, among others, including those from different political spectrums, is inserted in a global context in which the aim is to allocate tax revenues to the location where technology companies operate, regardless of their physical presence in a given country.

"Negotiations are underway within the OECD and G20 in this regard, particularly regarding the adoption of a linear tax on digital services. However, as these agreements have not been concluded, particularly due to the US's opposition, some countries have been unilaterally implementing Digital Services Tax (DST), such as Spain and the United Kingdom," he stated.

Digital Pix targets global revenue from big tech companies

Bill 157/25 establishes a 7% CSD tax rate on revenue generated from advertising services and the sale of user data. The calculation includes the overall revenue from these services in proportion to the ads served in Brazil and worldwide, and to users in Brazil and other countries.

According to the initial text of the proposal, the CSD revenue will have three main destinations:

• 25% for the National Digital Care Fund (FNCD) for data protection and combating disinformation;
• 25% for the Inclusive Digital Infrastructure Fund (FIDI) to strengthen technological sovereignty;
• 50% for a new direct income transfer instrument for platform users, called "Big Tech Pix."

Big Tech's Pix has a populist bias, says expert

In Fernando Canutto's assessment, despite the existence of similar taxes in other countries, the use given to the collection in PL 157/25 constitutes a populist bias, unlike what occurs in other countries that already apply this type of taxation.

“The difference is that, in the Brazilian case, in addition to taxation, the project links revenue collection to public policy funds and even to a direct transfer of income, something populist that tends to favor the current party in power [the Workers' Party],” he states.

New tax may affect consumers' pockets

As with other taxes, such as those on blouses, the Digital Social Contribution is expected to impact consumers' pockets. Marcelo Teske points out that Boulos' proposal offers a kind of cashback , returning a portion of the revenue to platform users.

However, it's unclear whether the allocated amount will be sufficient to cover potential service increases. According to Fernando Canutto, the additional tax collection could even drive away investment from the country.

"At the end of the day, the consumer pays the tax. In the case of Big Tech, this could mean higher prices for digital products and services, higher fees on intermediary apps, or even less investment in innovations and offerings in the Brazilian market," he comments.