Politics · Brazil · 11 hrs ago
Economist warns ending Brazil’s split payment could raise taxes
Brazil’s tax reform includes a system called split payment, which collects tax when a purchase is paid.
Daniella Marques, an economic coordinator for Flávio Bolsonaro’s campaign, said a future government could end the system because it could strain companies’ cash flow.
Economist Ângelo de Angelis, a co-author of the reform, warned that ending it could increase tax evasion and leave the government with less revenue.
He said that could lead to higher tax rates for the public.
The system is intended as a back-up: existing ways to pay tax remain available, and split payment would apply only if tax had not been paid by the time a transaction is settled.
It is initially optional for business-to-business transactions, and it may also make companies’ tax credits available faster.
The campaign proposal is to end the system, but the source does not say what would happen next.
An economist who co-authored Brazil’s tax reform warned that ending split payment could lead to higher taxes for the population.
Ângelo de Angelis said removing the system could leave the government short of revenue if companies failed to pay taxes.
Daniella Marques, economic coordinator for Flávio Bolsonaro’s campaign, had signaled that a future Bolsonaro government could end split payment.
The system is designed to collect tax automatically when a payment is made, but it would be optional for business-to-business transactions for now.
De Angelis said split payment would be used only if other tax-payment methods had not been used by the time a transaction was settled.
- Who
- Economist Ângelo de Angelis warned against ending split payment. Daniella Marques, economic coordinator for Flávio Bolsonaro’s campaign, signaled support for ending it.
- What
- De Angelis said ending split payment could cause tax rates to rise. Marques said it would ease pressure on companies’ cash flow.
- When
- Marques made her remarks on Wednesday, the 7th. The article was published on October 12, 2026.
- Where
- Brazil.
- Why
- De Angelis said the system helps prevent tax nonpayment, which could otherwise leave the government short of revenue.
Daniella Marques and Flávio Bolsonaro’s campaign
Ângelo de Angelis
Effect on companies’ cash flow
Daniella Marques and Flávio Bolsonaro’s campaign
Marques said split payment would “strangle” companies’ cash flow and signaled that a future Bolsonaro government could end it.
Ângelo de Angelis
De Angelis said the system would affect cash flow mainly for payments made upfront and advances to suppliers.
Effect of ending split payment
Daniella Marques and Flávio Bolsonaro’s campaign
Marques said ending it would bring relief to business owners.
Ângelo de Angelis
De Angelis said nonpayment could leave the government short of revenue, leading to higher tax rates.
Daniella Marques signaled that a future Flávio Bolsonaro government could end split payment.
Estadão published De Angelis’s warning that ending split payment could lead to higher taxes.
- Economist
- Ângelo de Angelis, ACF Consultores partner and tax reform co-author
- Campaign official
- Daniella Marques, economic coordinator for Flávio Bolsonaro’s campaign
- System purpose
- Automatically collects tax when a payment is made
- Business-to-business use
- Optional for now
- Publication date
- October 12, 2026
What people are saying
The first consequence of ending split payment is that there will be a shortfall in government funds because of nonpayment. If there is a shortfall in government funds because of nonpayment, the tax rate will rise.
would strangle
People think all financial transactions will go through split payment and that this will drain companies’ capital. That is a mistaken conception. The reality is that the old payment methods still remain, and split payment will happen only if those other old methods have not occurred first.
Sources
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