Brazilian Congress Advances IPVA Reform to Base Tax on Vehicle Weight and Cap Rate at 1%

The Chamber of Deputies' Constitution and Justice Committee (CCJ) approved the admissibility of PEC 3/26, a constitutional amendment that would overhaul the Imposto sobre a Propriedade de Veículos Automotores (IPVA). The proposal, authored by deputy Kim Kataguiri and reported by Rodrigo de Castro, replaces the current market‑value basis with the vehicle’s factory weight and sets a national ceiling of 1 % of the sale price. It also authorises states to grant discounts for less‑polluting vehicles. Supporters argue the change would align the tax with road‑wear impact and reduce the burden on owners of lighter cars, while critics warn it could penalise heavy, low‑cost vehicles – “the guy with an old, heavy truck would pay more than a lightweight sports car,” said deputy Helder Salomão. Estimates of the fiscal impact vary, with some analyses suggesting a loss of up to R$ 38‑200 billion in state revenues. The measure now moves to a special commission for merit review before being voted on in two plenary rounds and, if approved, sent to the Senate.