Brazil updates IRRF rules and launches new 2026 income tax table

The government of Rondônia issued Decree No. 31.761, signed by Governor Marcos José Rocha dos Santos and Finance Secretary Franco Maegaki Ono, to revise the rules for withholding the Imposto de Renda Retido na Fonte (IRRF) on public‑sector payrolls. The decree adds procedures for pausing tax deductions when exemptions apply and gives the State Secretariat of Finance (Sefin) authority to block financial transactions of units that fail to correct inconsistencies, with possible administrative, civil and criminal penalties.

At the federal level, Law 15.270/2025 introduced a new income‑tax table effective 1 January 2026. Salaries up to R$ 5,000 per month are fully exempt, and a graduated reduction applies to earnings between R$ 5,000.01 and R$ 7,350. The reform is expected to benefit about 10 million workers directly, raising the total number of people who will pay no tax to roughly 20 million. The changes use existing progressive rates combined with a new redutor that lowers the taxable base for eligible earners.