Brazil debates raising MEI revenue cap amid fiscal and growth concerns

The Brazilian Senate approved, and the Chamber of Deputies is reviewing, Project Complementary Law 108/2021, which would lift the annual revenue ceiling for Individual Microentrepreneurs (MEIs) from the current R$ 81,000 to as much as R$ 145,000. Government bodies—including the Ministry of Finance, the National Front of Mayors (FNP), the Confederation of Municipalities (CNM) and the National Association of Tax Officials (Comsefaz)—warn that the change could cost states and municipalities over R$ 21 billion in lost revenue, with a projected federal outlay of up to R$ 50 billion.

Proponents argue the adjustment would bring the limit in line with inflation, encourage formalisation, and stimulate the economy. Estimates from the Confederation of Brazilian Commercial Associations (CACB) suggest that raising the ceiling to R$ 144,000 could generate about R$ 81 billion in economic activity and create roughly 869,000 new jobs, while bringing millions of informal workers back under the tax regime. The bill is championed by Deputy Jorge Goetten of Santa Catarina and supported by the Mixed Parliamentary Front for Micro and Small Enterprises.

The debate pits fiscal sustainability for state and municipal budgets against potential gains in employment and tax compliance for the country’s roughly 26 million small enterprises, which account for more than half of all registered businesses in Brazil.