The oil and gas industry is not ruling out taking further legal action against the oil export tax, Valor has learned. The target now is the extension of the tax, approved last week. The government's argument, according to which the tax aims to compensate Brazil for the effects of the war in the Middle East, falls apart, according to the oil companies, since it reinforces the revenue-raising bias.
The extension of the tax by administrative act took on a regulatory character and weakened the argument that the government needed additional revenue to compensate for fuel subsidies, sources say. Data from the Ministry of Finance indicate that from March to May, tax revenue was R$1.05 billion. June data is not yet available.
Last week, the government issued a decree by which the Foreign Trade Chamber (Camex), of the Ministry of Development, Industry and Trade (Mdic), maintained the validity of the tax for the next two months, on the eve of the loss of effectiveness of Provisional Measure (MP) 1,340/2026. The MP established the rate of 12% on the gross revenue from the sale of oil abroad. As Congress did not convert the MP into law, the measure expired. Thus, without a new decision, the rate would cease to be valid from Friday (10).
When the government issued the provisional measure in March of this year, some companies in the sector filed lawsuits against the tax, hoping the measure would lapse in Congress. The lawsuits are ongoing. With the extension of the tax, further legal action is expected.
According to sources, a week before Provisional Measure 1,340 expired, information indicated that the government would maintain the export tax through a weaker legal instrument than the Provisional Measure. "If this was the most appropriate instrument [to maintain the tax], why didn't they do it back then, instead of using a provisional measure, which requires subsequent approval from Congress?" said one of the sources.
There is another factor that corroborates the view that the government wants to increase tax revenue through exports. Refining capacity is nearing its limit, and the demand for fuels needs to be met through imports. Since oil production far exceeds refinery capacity, opting for exports becomes inevitable, according to sources. Thus, the risk of domestic shortages alleged by the government is unfounded, in the market's view.
The legal fragility of the extension of the Provisional Measure further reinforces the perception of regulatory instability. "The decision amplifies concerns regarding the use of the Export Tax and raises significant questions about legal certainty, regulatory predictability, and respect for due legislative process," said the Brazilian Association of Independent Oil and Gas Producers (Abpip) in a statement.
According to Francisco “Chicão” Bulhões, founder and president of the Brazilian Institute for Regulatory Environment and Freedom (Barla) and former Secretary of Economic Development of Rio de Janeiro, in addition to increasing legal uncertainty, taxing oil exports through administrative acts hinders business planning and makes the investment environment less predictable.
According to him, the tax will not change fuel prices at the pumps and may generate effects that go beyond the government's coffers: "When tax measures are used as a short-term revenue-raising tool, it is the competitiveness of the Brazilian economy that loses," Bulhões stated.
Alexandre Chequer, global leader of energy, oil and gas at Tauil & Chequer Advogados Associado a Mayer Brown, says that companies with ongoing projects or evaluating assets to enter the Brazilian market have postponed their plans due to this tax. He stressed that the measure was taken months before a presidential election and that even if companies manage to reverse the extension of the tax in court, the damage has already been done.
“These are capital-intensive investments. Companies invest billions to develop an oil field, and suddenly you can't create a cost of 12% on exports. The damage this causes to the country in the short, medium, and long term is enormous,” Chequer stated.
Source: Economic Value