Proposed tax changes under PM No. 1.303 will not take effect after failing to secure the required approval by the deadline.
Brazil’s Chamber of Deputies did not approve Provisional Measure (PM) No. 1.303 issued on 11 June 2025, which proposes significant changes to the taxation of financial investments and virtual assets.
Key provisions included raising the withholding tax on interest on net equity (JCP), increasing the social contribution on net profit (CSLL) for certain financial institutions, and introducing a flat 17.5% income tax rate on specific financial investments.
PM No. 1.303, initially introduced as a provisional measure, needed to be approved by the specified deadline to remain in force. Since approval was not obtained, the proposed tax changes will now lapse and will not take effect.
