São Paulo audit flags massive tax breaks under Governor Tarcísio

The Court of Accounts of the State of São Paulo (TCESP) released a report on Governor Tarcísio de Freitas’ administration, labeling the expansion of tax exemptions a “parallel budget.” The audit shows that fiscal waivers reached R$ 73 billion in 2025 and are projected to rise to R$ 93.7 billion by 2026, outpacing the state’s revenue growth. Only 1 % of registered firms receive about 80 % of the benefits, while some of these companies are listed as debtors, accumulating billions in unpaid taxes.

The tribunal criticised the lack of impact assessments, data cross‑checking and oversight of third‑party contracts, including health‑sector concessions. It ordered the end of tax‑incentive secrecy by publishing the beneficiaries’ CNPJs and gave the state 90 days to present a corrective action plan to improve transparency, monitoring and fiscal discipline before the upcoming elections.