Brazil’s August federal tax revenue up 7.25% over last year, sets record

RIO DE JANEIRO, BRAZIL – According to Federal Treasury data released Thursday, the amount of federal tax revenue in the month reflects an increase of 7.25% compared to the same month last year, adjusted for inflation.

From January through August, the total amount of taxes and fiscal levies reached R$1.199 trillion (US$226 billion), 23.53% more than in the same period in 2020. According to the Treasury, it is the highest revenue for the month and period since 2000.

This year, only January posted a decrease compared to last year. In the other months, the Treasury registered growth and revenue set records for the month in February, March, April, and May.

The government is using the consecutive revenue increases as an argument to promote the tax reform bill in Congress. The logic is that increases in revenue will be converted into tax cuts, and that the level reached will not decrease.

The proposal to change the Income Tax (IR) rules, crucial to finance the “Auxílio Brasil” (Brazil Aid) program next year, was based on this assumption.

According to the Treasury, the reasons for the positive result are, once again, non-recurring factors. The extraordinary collections of Corporate Income Tax (IRPJ) and Social Contribution on Net Profit (CSLL) totaled R$29 billion between January and August this year, compared to R$2.8 billion in the same period last year.