Data released by the Brazilian Federal Revenue Service on April 29 shows that driven by resilient economic activity, a hike in the financial transaction tax, and rising imports, Brazil’s federal tax revenue recorded a real year-on-year increase of 4.99% in March 2026, reaching 229.249 billion reals and hitting the highest March level since records began in 1995.

In terms of quarterly performance, cumulative tax revenue for the first quarter of 2026 rose by 4.58% in real terms year-on-year to 777.117 billion reals, also setting a new historical high for the same period. Tax revenues directly administered by the Federal Revenue Service, covering major federal taxes and levies, climbed 5.56% year-on-year to 223.531 billion reals in March, serving as the core pillar of overall growth.

By contrast, revenues managed by other agencies declined, weighing on the overall performance. Oil royalties account for a large share of this segment, with related revenue falling 13.52% year-on-year to 5.718 billion reals in March.

In terms of tax structure, the financial transaction tax emerged as a key growth driver. Revenue from this tax rose by 2.785 billion reals year-on-year, a sharp increase of 50.1%, mainly fueled by the previous policy of raising its tax rate. Meanwhile, import-related tax performance remained robust: import duties and import-linked Industrial Products Tax (IPI) revenue surged 30.7% year-on-year, reflecting the combined effect of expanded import volumes and higher average tariff levels.

In addition, social security contribution revenue grew by 4.95% in real terms year-on-year, supported by the expansion of the national total wage bill and higher collections following the government’s reduction of payroll tax exemptions for certain industries. Overall, Brazil’s tax growth is underpinned by both domestic demand and foreign trade.