Politics · Brazil · 1 hr ago

Brazil approves MEI debt relief and higher income limits

Brazil approves MEI debt relief and higher income limits

Brazilian President Luiz Inácio Lula da Silva signed a law to ease costs for individual microentrepreneurs, known as MEIs.

It forgives eligible social security contributions collected through the DAS payment system, including interest, fines and fees, for debts established by October 13, 2026.

The debt relief is expected to start in January 2027, and MEIs must keep paying their regular DAS contributions to retain the benefit.

The process is expected to be automatic, but the government’s debt collection office still needs to set out the rules.

Annual income limits will rise to R$110,000 in 2027 and R$140,000 in 2028, and MEIs will be allowed to hire up to two employees.

More than three million MEIs have debts in active collection, totaling over R$12 billion; the relief could reach more than six million if it also covers debts not yet registered there.

The changes aim to give small businesses more financial breathing room as Brazil faces high interest rates and slower growth, but their effects depend on how the rules are implemented.

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