The Lucro Presumido Increase: Brazil’s Own Tax Authority Contradicts the Basis for the Charge

The Contradiction Behind the 10% Increase

Supplementary Law No. 224/2025 (Lei Complementar nº 224/2025 — LC 224/2025) brought a significant change for companies taxed under Brazil’s presumed-profit corporate tax regime (Lucro Presumido): a 10% increase in the presumption percentages used to calculate IRPJ (Imposto de Renda da Pessoa Jurídica, Brazil’s corporate income tax) and CSLL (Contribuição Social sobre o Lucro Líquido, Brazil’s social contribution on net profit). The law’s stated justification is that the Lucro Presumido regime is a tax benefit and would therefore be subject to the across-the-board reduction of tax incentives.

Just 32 days later, Brazil’s federal tax authority (Receita Federal do Brasil) itself published a document that contradicts that premise. This contradiction may be central for business owners weighing a challenge to the charge.

What Changed in Practice

The 10% increase applies to Lucro Presumido companies with annual gross revenue above R$ 5 million—or R$ 1.25 million per quarter—under Normative Instruction No. 2,306/2026 (Instrução Normativa RFB nº 2.306/2026), issued by Brazil’s federal tax authority.

• Services: from 32% to 35.2%.

• Commerce and industry: from 8% to 8.8%.

The first quarterly DARF (Brazil’s federal tax payment form — Documento de Arrecadação de Receitas Federais) reflecting the increased percentages came due in April 2026. Affected companies now need to measure the effects of the payments already made and decide how to handle the periods ahead.

The Advance Tax Ruling That Changes the Game

On January 27, 2026, the General Taxation Coordination Office (COSIT) of Brazil’s federal tax authority published COSIT Advance Tax Ruling No. 6/2026 (Solução de Consulta COSIT nº 6/2026). Its central subject was a different one—the presumed credit of ICMS, Brazil’s state VAT-type tax (Imposto sobre Circulação de Mercadorias e Serviços), under interstate tax agreement Convênio No. 106/1996—but the reasoning it applies bears directly on the Lucro Presumido regime.

In paragraph 14, COSIT stated that a government subsidy is not to be confused with a simple act of tax policy—such as setting rates, the tax base, or the calculation methodology—which are general instruments of taxation.

In paragraphs 18 through 21, COSIT concluded that alternative calculation methods are not tax benefits, even when they result in a tax amount lower than under the traditional system.

The ruling also cites precedent from Brazil’s Supreme Federal Court (Supremo Tribunal Federal — STF), Brazil’s constitutional court: ADI 1.502-8/DF, a direct constitutional challenge (Ação Direta de Inconstitucionalidade — ADI), in which the Court held that simplified calculation regimes do not have the nature of a tax incentive.

Why This Matters for the Lucro Presumido Regime

The Lucro Presumido regime is, by definition, a methodology for calculating the income tax base. Instead of computing actual profit, as under Brazil’s actual-profit corporate tax regime (Lucro Real), the company applies fixed percentages, set by Law No. 9,249/1995, to its gross revenue.

A taxpayer that opts for Lucro Presumido receives no guaranteed advantage. If the company’s actual profit margin falls below the presumed percentage, it pays more tax than it would under Lucro Real. This happens especially in sectors operating on tight margins.

So if COSIT itself recognizes that calculation methodologies are not tax benefits, classifying Lucro Presumido as a benefit—as Supplementary Law No. 224/2025 does—contradicts the position the agency expressed in another context.

What the Courts Were Saying When This Analysis Was Prepared

Three preliminary injunctions had suspended the enforceability of the 10% increase.

1st Federal Court of Resende, State of Rio de Janeiro

In mandado de segurança No. 5000259-79.2026.4.02.5116—a Brazilian constitutional remedy protecting a clear legal right against an unlawful or abusive act by a public authority or an agent exercising public functions—the decision held that Lucro Presumido is a calculation technique provided for in Article 44 of Brazil’s National Tax Code (Código Tributário Nacional — CTN), not a tax benefit. It also noted that the increase would tax nonexistent or fictitious income.

6th Federal Court of São João de Meriti, State of Rio de Janeiro

In mandado de segurança No. 5011528-63.2026.4.02.5101, filed collectively by the Rio de Janeiro chapter of the Brazilian Bar Association (Ordem dos Advogados do Brasil — OAB-RJ), the additional charge was suspended for law firms in the state of Rio de Janeiro.

26th Federal Civil Court of São Paulo

In mandado de segurança No. 5004081-07.2026.4.03.6100, a preliminary injunction was granted to a commerce-sector company, on the ground that the legislature could not turn a form of taxation provided for by law into a benefit.

Before the STF, three direct constitutional challenges were filed against Supplementary Law No. 224/2025: ADI 7920, filed by Brazil’s National Confederation of Industry (Confederação Nacional da Indústria — CNI); ADI 7936, filed by Brazil’s National Confederation of Health (Confederação Nacional de Saúde — CNS); and ADI 7944, filed by the OAB.

Practical Impact for Small and Midsize Companies

The hardest-hit sectors include services generally—such as technology, healthcare, and consulting—where the presumption percentage rises from 32% to 35.2% on the amounts above the threshold.

A little-discussed risk is the so-called quarterly trap created by Normative Instruction RFB No. 2,306/2026. Companies whose revenue is concentrated in certain periods—the events sector, for example—can hit the R$ 1.25 million trigger in a single quarter and pay the additional charge even if annual revenue stays below R$ 5 million. The adjustment only comes in the final quarter, creating an early cash outlay and an impact on cash flow.

Another relevant point is that raising the presumed base narrows the room for tax-exempt distribution of profits to the owners. Companies that distribute more than the presumed profit must keep rigorous accounting records to substantiate the excess.

What Should Be Assessed

• Court action: the legal theory draws on COSIT’s position, Article 44 of the CTN, and court precedents. The relationship among cost, risk, and potential savings must be calculated case by case.

• A simulation comparing Lucro Presumido and Lucro Real: for companies whose actual margin is below the presumed percentage, migrating may result in a lower tax burden.

• Collective measures: industry and professional associations have filed actions that may reach specific groups of taxpayers.

Conclusion

The 10% increase in the Lucro Presumido percentages rests on the premise that the regime is a tax benefit. Brazil’s federal tax authority itself, through COSIT, has recognized in another context that calculation methodologies are not tax benefits.

Provisional court decisions have embraced that reasoning, and actions before the STF have challenged the constitutionality of the change. None of this dispenses with individual analysis: each company must measure its own exposure and compare the available paths.

Sources Consulted

• Supplementary Law No. 224/2025, Article 4.

• Decree No. 12,808/2025.

• Normative Instructions RFB No. 2,305/2025 and No. 2,306/2026.

• COSIT Advance Tax Ruling No. 6/2026.

• Law No. 9,249/1995, Articles 15 and 20.

• Brazil’s National Tax Code, Article 44.

• STF, ADI 1.502-8/DF and ADIs 7920, 7936, and 7944.

• Mandados de segurança Nos. 5000259-79.2026.4.02.5116, 5011528-63.2026.4.02.5101, and 5004081-07.2026.4.03.6100.

This content is for informational purposes and reflects the sources indicated as of the publication date. It does not replace an analysis of the specific circumstances of each company or case.