Sin Tax (Imposto do Pecado)
Sin Tax (Imposto do Pecado)

Brazil is making big changes to how taxes work, and this time it is not just about numbers. The Selective Tax, or “sin tax,” now applies to products linked to health and environmental concerns. These updates are set to impact how certain goods and services are taxed across the country.

The recent tax reform has introduced major updates to simplify the system. Existing taxes are being combined, and a possible new VAT rate of 28.6 percent may apply to specific products.

The goal is to streamline the system while targeting goods seen as harmful to public health and the environment.

What is Included in the Sin Tax (Imposto do Pecado)?

The sin tax focuses on products that are linked to health risks, environmental concerns, or luxury consumption.

The goal is to discourage their use or fund public initiatives through higher taxes. Here is a closer look at the products that are part of this tax.

Category Examples Tax Rate Purpose of Tax
Alcoholic Beverages Beer, wine, spirits 26.5% Address public health issues
Tobacco Products Cigarettes, cigars, tobacco, vapes 26.5% Reduce smoking-related health risks
Sugar-Sweetened Beverages Soft drinks, energy drinks 26.5% Combat obesity and promote health
Vehicles Cars, trucks, motorcycles 26.5% Reduce emissions, encourage eco-options
Boats and Aircraft Yachts, private jets 26.5% Tax luxury consumption
Gambling Activities Betting, lotteries, fantasy sports 26.5% Raise funds for social initiatives
Mineral Resources Coal, other mineral fuels 26.5% Promote cleaner energy

Note: The tax rate of 26.5% is the overall consumption tax rate as set by recent legislation. Specific rates for each category may vary based on future regulations.

What is Excluded from the Sin Tax?

Items excluded from the sin tax
Items excluded from the sin tax

Brazil has deliberately left out essential goods and services from the sin tax to make sure that public access to critical items remains unaffected.

The exclusions are meant to protect basic living standards and health.

Pharmaceuticals

Pharmaceuticals are fully exempt from taxation. Over 383 medications are included, such as:

  • Painkillers like paracetamol and dipyrone.
  • Antibiotics used for treating infections.
  • Drugs for chronic conditions, including insulin.

Basic Food Items

Essential food products are excluded from the sin tax. This category includes:

  • Staples such as rice, beans, and flour.
  • Vegetables, fruits, and eggs needed for a balanced diet.
  • Cooking oil and other essentials for preparing daily meals.

Medical Devices

Medical devices necessary for health and mobility are not taxed.

  • Wheelchairs and prosthetics that aid physical movement.
  • Hearing aids and other assistive devices that improve quality of life.

Personal Hygiene Products

Hygiene products critical for cleanliness and health are also exempt. Examples include:

  • Soap and toothpaste, which are daily essentials.
  • Menstrual health items, such as sanitary pads.

By taxing products linked to harm while shielding essential items, the government is walking a fine line between revenue generation and public well-being. The spotlight now turns to how these measures will shape daily life.

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Miloลก Nikolovski
Miloลก Nikolovski
I am Milos Nikolovski, a journalist with an insatiable curiosity for global affairs, cultural intersections, and the stories that define our time. My work spans continents, covering the pulse of international relations, the evolving dynamics between the United States and Brazil, the complexities of politics, and the deeper narratives found in travel, food, and everyday life. Every story I tell comes from direct experience, firsthand conversations, and an unfiltered approach to truth. I do not chase sensationalism or empty headlines. My focus remains on substanceโ€”on the issues that shape nations, the policies that drive decisions, and the cultural shifts that reveal where societies are headed. Whether dissecting diplomatic strategies, unraveling the economic forces linking Brazil and the United States, or walking through the markets of Sรฃo Paulo to uncover the hidden layers of a cityโ€™s identity, I believe in journalism that informs and challenges perspectives. Travel plays a crucial role in my work, not as an escape but as a means to engage with the world. The places I visit are not vacation spots; they are living, breathing spaces filled with voices, struggles, and triumphs. Whether exploring the political landscapes of Latin America, tracing historical legacies in Europe, or uncovering the latest food revolution in an unexpected corner of the world, my mission remains the sameโ€”to document, to report, and to bring forward stories that matter. Beyond borders and breaking news, my work is guided by core values: honesty, independence, and accessibility. Journalism must be fearless, unfiltered, and unbound by external pressures. I write for those who seek more than surface-level narratives, for those who value depth over distraction, and for those who refuse to settle for anything less than the full picture.
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