Payroll in 17 sectors will be reburdened from 2025

Following an agreement between the government, the National Congress and representatives of 17 sectors of the economy, the payroll for these activities will continue to be exempt this year, but there will be rates gradually restored between 2025 and 2028.

The Minister of Finance, Fernando Haddad (photo), detailed the closing of the agreement after meeting with the president of the Senate, Rodrigo Pacheco, and the leader of the Senate Government, Randolfe Rodrigues (no party-AP).

“This is important because we are going to support Social Security revenue, and it is the logic of Social Security reform to balance the accounts. When we take the sacrifice of a worker who sometimes has to work for a year, two years, three years more, as happened with the Social Security reform, we have to understand that, on the revenue side, there has to be a correspondence of the same effort”, said Haddad in the Senate.

The re-encumbrance begins next year, with the employer contribution of the 17 sectors to Social Security being made as follows:

• 2024: total exemption;

• 2025: 5% rate on payroll;

• 2026: 10% rate on payroll;

• 2027: 15% rate on payroll;

• 2028: 20% rate on payroll and end of exemption.

Modulation

Before announcing the agreement in the Senate, Haddad met with the ministers of the Federal Supreme Court (STF) André Mendonça and Luiz Fux. The Finance Minister stated that the government will ask the Supreme Court to modulate the injunction granted by the STF minister, Cristiano Zanin, which blocked the exemption from payroll in sectors of the economy. Through modulation, the Judiciary can approve the agreement for the gradual termination of the benefit.

Extended until the end of 2027, after the approval of a bill that five Supreme Court ministers considered unconstitutional, the payroll tax exemption allows companies in 17 sectors to replace the social security contribution of 20% on employees’ payroll , at a rate of 1% to 4.5% on gross revenue.

In force since 2012, the exemption allows companies in the benefited sectors to contribute less to Social Security and, in theory, hire more workers.

At the end of last year, Congress approved the bill that also reduced the Social Security contribution of small municipalities from 20% to 8% of the payroll. President Luiz Inácio Lula da Silva vetoed the text, but Congress overturned the veto at the end of last year.

In the last days of 2023, the government issued a provisional measure revoking the approved law. Due to the lack of agreement in Congress to approve the text, the government agreed to transfer the reburdenment to bills.

However, at the end of April, the Federal Attorney General’s Office appealed to the Supreme Court. Minister Cristiano Zanin, from the STF, accepted the request for the immediate suspension of tax relief and aid to small municipalities. Since then, the government has been trying to reach an agreement with the 17 sectors of the economy.