Tax burden in Brazil driven by pandemic to highest level since 2010

RIO DE JANEIRO, BRAZIL – Brazilians’ total taxes in 2021 increased to 33.9% of GDP (gross domestic product) in Brazil in 2021. This is the highest level in the historical series that began in 2010. It increased by 2.14 percentage points compared to 2020.

According to the Bulletin of Estimates of the Gross Tax Load of the General Government, this high value reflects the end of tax incentives implemented during the pandemic and economic recovery. The Department of Revenue released the bulletin on Monday (Apr. 4, 2022). Here is the full text (594 KB).

RECORD IN STATES

Taxes paid to the central government account for the largest share of taxes: 22.48% of GDP. However, this weight was already larger – in 2011, it reached 23.16% of GDP.

The total for states (9.09% of GDP) and local governments (2.33% of GDP) is at the highest level of the series started in 2010, according to the Bulletin of Estimates of the Gross Tax Load of the General Government.
Cut in 2022

The Bolsonaro government used the high revenues to cut taxes this year, such as the IPI (tax on industrial products), the PIS/COFINS fuel tax, and import duties on products such as ethanol. The measures may affect the gross tax burden.

In 2021, taxes on goods and services reached 14.76% of GDP. Therefore, they accounted for the largest share of the Brazilian tax burden. In second place are social contributions, and in third place are taxes on income, profits, and capital gains.

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