The Federal Regional Court of the 3rd Region (TRF-3), based in S\u00e3o Paulo, ruled against the application of the additional 10% on the Income Tax (IRPJ) and CSLL rates in the presumed profit regime, adopted by companies with annual revenue of up to R$ 78 million. According to Judge Wilson Zauhy, the case's rapporteur, the increase in the tax burden violates the principle of legality, enshrined in the Federal Constitution.<\/p>\n\n\n\n
This is the first second-instance decision favorable to taxpayers in the Federal Court of S\u00e3o Paulo, according to a survey conducted by Valor based on public data from the National Council of Justice (CNJ). The overall score, however, is unfavorable to companies. Although two other injunctions were granted in the first instance, in S\u00e3o Paulo and Rio de Janeiro, the majority of requests are denied. This occurred in 17 cases. And there is one ruling in favor of the Federal Government. The company has already filed an appeal.<\/p>\n\n\n\n
There is also a class action lawsuit in progress, filed by the S\u00e3o Paulo branch of the Brazilian Bar Association (OAB-SP). Any favorable decision would benefit all law firms in the state (case no. 5004598-12.2026.4.03.6100).<\/p>\n\n\n\n
The issue has also been brought before the Supreme Federal Court (STF). It is in the hands of Minister Luiz Fux. The National Confederation of Services (CNS) filed a direct action of unconstitutionality alleging violation of the principles of contributory capacity, legal certainty and equality (ADI 7936).<\/p>\n\n\n\n
The discussion is based on Complementary Law (LC) No. 224 of 2025, which equated presumed profit to a tax benefit and increased the rates by 10%. The additional tax is levied on companies with revenue exceeding R$ 5 million per year or R$ 1.25 million per quarter \u2013 which would anticipate taxation, as confirmed by the Revenue Service in Normative Instruction No. 2306\/2026.<\/p>\n\n\n\n
The new law also brought other changes, such as increased taxation on betting, fintechs, and interest on equity (JCP). According to calculations by Warren Investimentos, this measure could increase federal government revenue by at least R$10.5 billion in 2026. The Ministry of Finance expects to obtain net revenue of R$15 billion. The difference considers the application of the principle of prior notice, a tax rule that prohibits the immediate collection of increased taxes.<\/p>\n\n\n\n
For companies, presumed profit is a legitimate system for calculating corporate income tax (IRPJ) and social contribution on net profit (CSLL). They argue that equating it to a tax incentive distorts the nature of the regime and violates principles of equality, ability to pay, and free competition. This is because it would create a disparity between taxpayers who earn above R$ 5 million.<\/p>\n\n\n\n
In the TRF-3 (Regional Federal Court of the 3rd Region), Judge Wilson Zauhy accepted the company's arguments, reversing an unfavorable first-instance decision. In his ruling, he states that presumed profit is a system provided for in Article 44 of the National Tax Code (CTN), as are actual and arbitrary profit. He further states that this system "implies the renunciation of the determination of actual profit and the deduction of real costs and expenses, in exchange for the adoption of an objective and simplified taxation criterion, and should not be confused with a tax benefit.",<\/p>\n\n\n\n
\u201c"It must also be considered that the increase in the presumption percentage, as established by LC 224\/2025, based exclusively on the annual revenue volume (of R$ 5 million in the calendar year), does not consider or require any concrete demonstration that there has been a change in the average profitability of the activities covered," it says (case no. 5003793-26.2026.4.03.0000).<\/p>\n\n\n\n
He also took into account that, since the new law was published on December 26, 2025, there was not enough time for companies to adapt to the change, which impacts cash flow. The decision benefits the 2X Capital group, a financial restructuring consultancy, represented by the law firm NDN Advogados.<\/p>\n\n\n\n
With this understanding, the company no longer has to pay the additional amount at the end of this quarter, says lawyer Roberto Gomes Notari, partner at NDN Advogados, who worked on the case. In his view, the law is unfounded and reflects the government's "eagerness to collect revenue.".<\/p>\n\n\n\n
\u201cThis is not a tax benefit; it is an option for the taxpayer within the legal framework. The change is only in the method of calculation, because in the actual profit method, the tax is calculated on the profit actually earned in the period, while in the presumed profit method, the rate is reduced on the total revenue,\u201d he states. Notari also filed a lawsuit on behalf of his firm, but the preliminary injunction was denied (case no. 5003866-31.2026.4.03.6100).<\/p>\n\n\n\n
In the only ruling issued on the subject so far, Judge Alexandre Alberto Berno, of the 2nd Federal Court of Ribeir\u00e3o Preto (SP), acknowledged that presumed profit is not "a tax benefit stricto sensu," as it is an option for the taxpayer. However, it can be considered as such because "in the context of tax planning, it allows for a reduction in the tax burden," which allows it to be subject to limitation by the Legislative Branch (case no. 5000663-55.2026.4.03.6102).<\/p>\n\n\n\n
Tax lawyer F\u00e1bio Calcini, a partner at the Brasil Salom\u00e3o law firm, which is working on this case, says he has already filed an appeal requesting a stay of execution. "The way the increase was implemented and the justification found by the government that structures the law is completely illegal and unconstitutional," he states.<\/p>\n\n\n\n
According to Calcini, the increased tax burden on the company cannot be passed on to customers, causing losses. "The company cannot pass this cost on because the contracts have already been signed and the profit margin was almost nonexistent. To fulfill the contracts, it will basically have to operate at a loss, being under the presumed profit regime, which generates income tax even when incurring losses," he says. "It's an inconsistency."\u201c<\/p>\n\n\n\n
Lawyer Ol\u00edvia Tonello, partner at Tonello Faulhaber Advogados, emphasizes that presumed profit is a legal method for calculating Corporate Income Tax (IRPJ) and Social Contribution on Net Profit (CSLL). "The increase intended by LC 224\/2025 represents an effective increase in the tax burden, linked only to revenue, without demonstrating actual profitability, which constitutes a clear violation of the principle of ability to pay."\u201c<\/p>\n\n\n\n
According to tax lawyer Ana Lucia Marra, partner at Sanmahe Advogados, the premise adopted in LC 224 is flawed. "The fact that a company has revenue exceeding R$ 5 million does not necessarily mean that profitability will be higher; this has not been demonstrated and no justification has been presented," she states. She adds that the rule may tax income that does not exist, which violates the principle of ability to pay, as well as the principle of equality among taxpayers.<\/p>\n\n\n\n
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