BRAZIL · COURTS
Key Facts
- The country Brazil, Latin America’s largest economy and one of the world’s biggest farm exporters, holds its presidential runoff on Sunday 25 October.
- What happened On Thursday 15 October, Brazil’s Supreme Court voted six to five that the farm sales levy was unconstitutional for the years before 2018.
- The levy Known as Funrural, it charged rural employers a share of gross sales, and buyers such as meatpackers had to withhold it.
- The cutoff From 1 January 2018, a new law made both the levy and the buyer withholding constitutional.
- The limit The court rejected a proposal to limit the effects of the ruling, so claims over past payments are not capped.
- Power Index Brazil ranks 1st of 14 in The Rio Times Latin America Power Index, with 75.0 points (October 2026 edition).
Runoff · Sunday, 25 October
Brazil Runoff 2026: Lula vs Flávio
Date, polls, debates, odds and how the runoff works, updated every day.
Brazil runoff polls · Polymarket and Kalshi odds · When results come
Prediction markets · who wins the runoff
Implied chance of winning Brazil’s presidency on 25 October, from traders’ prices.
Polymarket
Flávio Bolsonaro 79.2% · Lula 20.5% (US$184 million traded)
Kalshi (regulated in the US by the CFTC)
Flávio Bolsonaro 78% · Lula 22%
As of 16 October, 3:20 am ET (08:20 Lisbon), updated every 20 minutes. Prices are bets, not polls, and can move fast.
Why we show this: prediction markets turn real-money bets into a live probability that moves within minutes of the news, which is why investors, campaigns and newsrooms in the United States now follow them closely. We show them next to polls and official results, never instead of them.
Brazil’s Supreme Court struck down a farm pension levy for the years before 2018 on Thursday 15 October, ruling by six votes to five. A majority held that the charge on farmers’ sales lacked a valid legal basis for that period.
For US readers, the ruling touches one of the world’s biggest farm exporters, whose beef, soy and coffee reach American shelves. It also bears on public social-security revenue that investors in Brazilian bonds and the real watch, ten days before the presidential runoff.
What the Supreme Court Decided
The Supreme Federal Court, known as the STF, ruled in Brasília on Thursday that the farm pension levy was unconstitutional before 1 January 2018. According to Poder360, it also struck down the rule that forced companies buying farm produce to withhold and pay the money.
The case, known as ADI 4395, was brought by Abrafrigo, the Brazilian meatpackers’ association. The legal news site Migalhas said the judgment began in the court’s virtual plenary in 2022 with five votes on each side.
How the Six-to-Five Vote Came Together
Justice Dias Toffoli decided the outcome by adjusting his vote during the session, Migalhas reported. He called the 2001 law behind the farm pension levy “born lame”, a Brazilian way of saying it was flawed from the start.
Migalhas listed Edson Fachin, Rosa Weber, Ricardo Lewandowski, Celso de Mello and Marco Aurélio as the other five votes against the levy. Poder360 noted that four of the justices who backed the ruling have since retired, and their successors would review any appeals.
Gilmar Mendes, the rapporteur who drafts the lead opinion, argued that a 1998 constitutional amendment already allowed a tax on farm revenue. Alexandre de Moraes, Cármen Lúcia, Luiz Fux and Luís Roberto Barroso voted with him, according to Migalhas.
Who Pays the Levy and Who Gains
The farm pension levy, called Funrural, charged rural employers a share of the gross revenue from selling their harvest or cattle. Its full name is the Rural Worker Assistance Fund, and it helps finance social security for rural workers.
Under the old rules, buyers such as meatpackers had to withhold the levy from farmers and pay it to the state. The court said that withholding rule was also unconstitutional for the period before 2018, Poder360 reported.
Abrafrigo argued that the Constitution allows this kind of levy only for family farmers without permanent employees, Migalhas reported. It also contested the duty placed on meatpackers to collect the money on the state’s behalf.
Why 2018 Is the Dividing Line
A 2018 law, number 13.606, changed the rules, and the justices treated the later period differently. Poder360 reported that from 1 January 2018 both the farm pension levy and the buyer withholding became constitutional.
Migalhas reported that the 2018 law set a rate of 1.2% and let each farm employer pay on gross revenue or on payroll. Poder360 described the same annual choice for producers.
Toffoli proposed that the decision apply mainly from the date of judgment, which would have limited retroactive refund claims. The majority rejected that proposal, according to both Poder360 and Migalhas.
What It Means for You
If you buy Brazilian beef or coffee, the ruling concerns a domestic tax and not export duties or US tariffs. Brazilian beef shipments to the United States have grown fast, a trend covered in this report on September beef exports.
For investors in Brazilian meat processors and farm companies, any refund of past payments is the point to watch. Which firms can claim money, and how much, is the question the market will ask next.
For anyone following Brazil’s budget, social-security revenue is a sensitive line, and the ruling lands ten days before the 25 October runoff. The runoff pits President Lula, the left-wing incumbent, against Flávio Bolsonaro, a conservative senator.
What Is Not Known
The government has not reported what the ruling will cost the public budget. It is open how much past payments add up to, and which farmers and companies can claim refunds.
Moraes said the question could be reopened if parties file appeals, which successors of retired justices would then review. Whether any party will appeal is not known.
More: Brazil news in English, every day from The Rio Times.
Frequently Asked Questions
What is the farm pension levy?
The farm pension levy, called Funrural, helps fund rural social security and is calculated on the gross sales of farm produce. Its name comes from the Rural Worker Assistance Fund.
Does the ruling cancel every farm tax in Brazil?
No, it covers only the farm pension levy and the buyer withholding rule for the period before 1 January 2018. Since that date, Poder360 reported, both are constitutional.
Who brought the case to the Supreme Court?
Abrafrigo, the Brazilian meatpackers’ association, filed ADI 4395, the direct action challenging the levy. It argued that the Constitution allows the charge only for family farmers without permanent employees.
Does the ruling change US tariffs or beef imports?
No, because the ruling concerns a Brazilian domestic levy. The reports on it mention no change to exports or US trade rules.
Could the decision still change?
Possibly, because Justice Moraes said the issue could be reexamined if appeals are filed. Poder360 noted that successors of retired justices would review such appeals.
Sources: Poder360 (STF ruling), 15 October 2026; Migalhas (live judgment), 15 October 2026; Poder360 (case on the agenda), 15 October 2026.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief