Lula’s Party Files Bills to Tax Dividends

BRAZIL · TAX POLICY

Lawmakers led by President Luiz Inácio Lula da Silva’s Workers’ Party (PT) filed four bills in the Chamber of Deputies, Brazil’s lower house, on Friday 13 November 2026. They would tax dividends at 15%, create a wealth tax, tax now-exempt credit notes at 7.5% and raise the tax on interest on equity, a shareholder payout that cuts a company’s own tax bill, to 20%.

The bills were registered at 18:29 Brasília time (4:29 p.m. ET), while the government’s own fiscal package awaits a vote in the same chamber. For investors, they target dividend income that residents receive with limited tax, and they are proposals only, with no vote scheduled.

What Do the Four Bills Say?

Deputy Pedro Uczai of Santa Catarina state, who leads the Workers’ Party alliance in the Chamber, is the first-named author, and more than 80 deputies from the party and its allies signed. The Chamber’s records list the texts as PL 5852, 5853, 5854 and 5855 of 2026, where PL stands for projeto de lei, or bill.

PL 5854 would withhold 15% of every dividend paid to an individual resident in Brazil, whatever the amount. It would also apply 15% to dividends sent abroad, except where tax treaties against double taxation say otherwise.

PL 5853 would withhold 7.5% income tax on the returns of LCI and LCA, credit notes that banks issue to fund real estate and farming, and on similar exempt notes such as CRI, CRA and incentive debentures. PL 5855 lifts the withholding rate on interest on equity (JCP), a way for companies to pay shareholders that lowers their own tax bill, from 17.5% to 20%.

PL 5852 creates the Tax on Large Fortunes, a levy the 1988 Constitution allows but Brazil has never charged. It would apply to net worth above R$15 million (about US$2.7 million) at rates from 0.7% to 3%.

Why Dividends Are the Core of the Plan

Brazil has exempted dividends from personal income tax since 1996, the authors say in the bill’s justification, and they note that it was one of very few countries to do so alongside Estonia and Latvia. Law 15.270 of 26 November 2025 began to change that by adding withholding on payouts above R$50,000 a month (about US$8,850) from one company to one person, plus a minimum tax on high incomes.

The authors argue that this still leaves part of capital income taxed more lightly than wages. Their answer is one flat 15% rate on all dividends paid to individuals, which is why the bill matters to anyone who holds Brazilian shares.

Why It Matters for Investors

The text published by the Chamber on 13 November 2026 would drop today’s R$50,000 monthly threshold and tax every payout, so R$150 would be withheld from a dividend of R$1,000 (US$27 and US$177 at about R$5.65 per dollar at the 13 November market close). For residents, the withheld tax would be credited against the annual income-tax return, and the rule would start on 1 January of the year after the law is published.

The bank-note bill matters because LCI and LCA are popular exempt savings tools. A 7.5% tax would narrow their advantage over taxed deposits, though the bill does not say how many investors hold them.

What to Watch

The Senate approved the main text of the government’s fiscal-adjustment bill, 45 to 31, on Thursday 12 November 2026, and votes on four amendments, called destaques, on Tuesday 17 November. The bill then goes to the Chamber, where its president, Hugo Motta, sets the agenda, with no date confirmed, while the four tax bills must first be assigned to committees.

What It Means for You

A shareholder in a Brazilian company would see 15% withheld from each dividend if PL 5854 passes unchanged, and a foreign holder would face the same 15% on money sent abroad unless a treaty says otherwise. Nothing changes today: the bills are proposals, and the earlier withholding rules stay in force until Congress votes.

Readers can follow the wider budget fight in our report on the Senate vote and on the Brazil news page. We also cover the party’s demand for more cabinet posts and lower interest rates.

What Is Not Known

We found no public position from Lula or the Finance Ministry on the four bills, and no official estimate of the revenue they would raise. We also did not find a named opponent of the bills yet.

Frequently Asked Questions

What would the PT bills change?

They would tax dividends at 15% and create a wealth tax. They would also tax LCI and LCA notes at 7.5% and raise the interest-on-equity rate from 17.5% to 20%.

Are the bills law?

No. They were filed on 13 November 2026 and still need committee review and votes in the Chamber of Deputies and the Senate.

What are LCI and LCA?

They are credit notes issued by banks to fund real estate (LCI) and agribusiness (LCA). Returns are currently exempt from income tax for individuals.

Would foreign shareholders pay the 15%?

The text applies 15% withholding to dividends sent abroad. Treaties against double taxation could change that.

This article was produced by The Rio Times’ automated AI newsroom. Editorial responsibility: Matthias Camenzind, Publisher and Editor-in-Chief. The Rio Times also runs Ask Rio Times, which answers from 100,000+ of our own articles, the daily Latin America Power Map, and prediction-market odds on elections and markets.. How we use AI · Report an error

Brazil runoff, Sunday, October 25: Brazil runoff: date, poll closing times and when results start. Latest: Brazil runoff polls, Flávio 51%, Lula 49%.