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As a measure of the federal tax collection voracity, in 2026, the astronomical figure will be reached next Saturday (27), six days earlier than the previous year (July 3). Another piece of data that attests to the ferocity of the ‘Brazilian Lion’ is that an identical mark was only recorded in 2015 on December 9 of that year.
The information is from the Impostômetro, a panel maintained by the São Paulo Commercial Association (ACSP), revealing that this was the first time the level was recorded, still in the first semester.
Tax burden surge is insufficient in light of federal expenses
But more impressive than the pharaonic proportions of the ‘fiscalist windfall’ is the typically Brazilian contradiction: even with the surge in the tax burden, very close to 34% of GDP, the money is not enough for Brasília to achieve the principle of ‘republican’ fiscal balance. According to the ‘Gasto Brasil’ platform, which monitors public expenses, the non-financial expenditures of the public sector already amount to a staggering R$ 2.7 trillion, that is, R$ 700 billion more than the federal revenue.
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For the ACSP, the anticipation of the tax mark was made possible by the combination of three fundamental factors: economic activity, inflation, and an increase in the tax base. This trinity, in turn, results from various measures, such as the taxation of exclusive funds and offshores; changes in state subsidies; resumption of fuel charges; payroll re-oneration; increase in the IOF (Tax on Financial Operations); increase in taxation on interest on equity; end of benefits for the events sector and the incidence on sports betting, among others.
Rising inflation pressures prices of goods and services
According to the economist from the Gastão Vidigal Institute of Economics, ACSP, Ulisses Ruiz de Gamboa, “the heating of economic activity expands the tax base. At the same time, inflation pressures the prices of goods and services and, as a large part of taxes is levied on prices, revenue follows this movement.”
Pointing out the ‘sore spot’ – the mismatch between revenues and expenses – the president of ACSP is direct: “Revenue grows, but public spending grows at an even faster pace. This mismatch is the central knot of the country’s fiscal difficulties,” he says.
Brazil presents one of the worst tax returns on the planet
From the citizen’s point of view, however, the finding is inevitable: Brazil presents one of the worst tax returns on the planet, according to international economic rankings. In this regard, the following topics highlight the ‘poor quality’ of spending in the country:
Mandatory expenses: The Budget is constrained by rigid expenses with Social Security and payroll, leaving little discretionary space for infrastructure.
Increase in costs: expenses outside the fiscal rule ceiling, subsidies to specific sectors, and expansion of costs continue to pressure the National Treasury.
Control criticisms: bodies like the Federal Court of Accounts (TCU) warn about the lack of transparency in budget maneuvers, which affects the efficiency and effective delivery of health, education, and security.
Another variable, no less relevant, that helps explain the growing demand for resources by the Union is the low effectiveness of federal income transfer programs – such as Bolsa Família and the Continuous Cash Benefit (BPC) — which present a paradox: despite being ‘highly effective’ in combating extreme poverty and encouraging local consumption, they suffer from a lack of administrative efficiency, coordination, and “exit strategies.”
Among the successes of the transfer programs, notable are:
Reduction of monetary poverty: studies show that programs like Bolsa Família reduce extreme poverty by up to 20%. The money is transferred directly to the end, stimulating commerce and generating indirect jobs in small municipalities.
Indirect return: unlike other public expenses (such as the cost of the public machine), income transfer has a high economic multiplier. Each real invested quickly returns to the economy in the form of basic consumption of food and services.
Errors that imply ‘serious bottlenecks in resource management…
Control blackout and disorganization: a historical audit by the [Federal Court of Accounts (TCU)] revealed that Brazil has 914 income transfer programs spread across states and municipalities. Of this total, more than 60% are managed by spreadsheets or manual controls, without any automatic integration with the [Single Registry (CadÚnico)].
Duplication of benefits and queues: the lack of data cross-referencing causes families to receive multiple similar benefits from different spheres (municipality, state, and federation), while almost 1 million eligible families wait in the Bolsa Família queue without any assistance.
Unlocated beneficiaries: TCU inspections identified a high percentage of unlocated beneficiaries and the overload in Social Assistance Reference Centers (CRAS), limiting the inspection of fraud or registration updates.
Lack of exit strategies: critics and economists emphasize that the current design focuses almost exclusively on immediate poverty relief but fails to integrate beneficiaries into robust professional qualification and productive inclusion programs. This perpetuates benefit dependency for generations.
High fiscal pressure: the cost of these transfers combined with Social Security exceeds the R$ 1 trillion mark. This pressures inflation on the public spending side and severely reduces the government’s ability to invest in infrastructure, health, and education.
