Following the Senate's approval on December 17, Brazil's Congress passed PLP 128/2025 on December 26, raising taxes on fintechs—part of a broader fiscal package cutting benefits and hiking other levies to unlock R$22.45 billion for the 2026 budget. The fintech measure aims to align fiscal treatment with traditional banks for competitive neutrality, but fuels debate on stifling innovation and financial inclusion. Proponents see fair compensation; critics fear consumer harm.
On December 26, 2025, Brazil's Congress approved Complementary Bill 128/2025 (PLP 128/2025), increasing taxes on fintech revenues. This provision, which raises CSLL from 15% to 17.5% for fintechs until 2027 (and 20% thereafter), generates R$1.6 billion and completes the package initially passed by the Senate on December 17 alongside 10% cuts to federal tax benefits, higher taxes on online bets and interest on own capital (JCP).
A tax law professor supports the bill for preserving competitive neutrality, arguing 'revenues from the same activity should receive equal tax treatment.' Fintechs dominate digital areas like payments and personal credit with higher margins, and the tax offsets revenue losses from the IRPF exemption up to R$5,000—seen as preferable to taxing dividends broadly.
The president of Zetta, a financial firms association, counters that fintechs already pay more tax (effective rates 36.5% in 2023 vs. banks' 8.9%; 29.7% in 2024 vs. 12.2%), crediting them with modernizing the system: doubling active users since 2018, including millions, 85% positive impact per AtlasIntel, and charging 34 times fewer fees—forcing banks to waive R$90 billion since 2019. Critics say it penalizes innovation, with 92% of Brazilians expecting higher service costs; they suggest a 17.5% minimum rate for all institutions, raising R$8 billion vs. R$1.6 billion.
Both sides acknowledge fintechs' maturity under Central Bank regulation but clash on balancing public finances without curbing growth. The debate coincides with consumption tax reform, highlighting needs for wider fiscal discussions.
