Opposition leader presents bill to block IOF increase by Lula government

Senator Rogério Marinho (PL-RN), leader of the opposition in the Senate, presented, this Friday (23), a Legislative Decree Project (PDL) to block the effects of two decrees of the Lula government published throughout this week. The decrees increase the rates of the Tax on Financial Transactions (IOF) on credit, exchange and remittances abroad.

As shown by Gazeta do Povo , the tax increase not only harms citizens directly, but represents an additional obstacle for Brazilian companies , which are already navigating in turbulent waters. The Lula government expects to raise R$20 billion with the increase .

In justifying the bill, Rogério Marinho claims that the measures disregard the impact on monetary and exchange rate policy. The opposition leader also warns of the formal and material flaw in the normative acts. Marinho claims that the government went beyond the extra-fiscal and regulatory nature of the tax by adopting it as a central measure for short-term fiscal balance, “which would reduce the need for contingency measures through purely revenue-raising measures.”

“This is not a mere disagreement on tax policy, but rather a formal and material defect in the normative acts, which impose a billion-dollar tax burden on the economy, harm the competitiveness of Brazilian companies, penalize investments abroad and compromise the credibility of economic policy,” warns the senator.

According to the PDL's justification, the decrees imposed a readjustment of more than three times in the rates charged to legal entities and in foreign exchange transactions; for investors, the rate jumped from 0.38% to 3.5%, practically ten times more. The change, Marinho points out, was published without any deadline for adaptation.

The senator also says that the increase in IOF goes against the public interest by raising the tax rate that “at least since 2022, has been reduced by the commitment adopted by the country to join the OECD”, the Organization for Economic Cooperation and Development.