The government of Luiz Inacio Lula da Silva (PT) published Provisional Measure (MP) No. 1,399/2026, which sets the tax rates for the selective tax, known as the "sin tax". The text establishes a tax of 2.6% on sugary drinks, 4.2% on beer and 0.5% on gambling, in addition to specific rates for cigarettes, vehicles and other products. The highest percentage rate is 66.7% for cigarettes and cigarettes, applied to a reference value, in addition to a specific charge of R$3.50 per pack of 20 cigarettes. For products with controlled prices, the reference value will correspond to 15% of the retail sale price. To ease the transition, the government also submitted a proposed constitutional amendment (PEC) to Congress that allows for the temporary continuation of the IPI (tax on industrial products) on affected sectors until the new tax takes effect. The temporary index sets different rates for each product category, based on the rates currently charged under the IPI and the conversion factors. According to the appendices of the measures, the tariffs planned for 2027 are: - Sweetened beverages: 2.6% for products in the category that includes soft drinks.
- Malt beers: 4.2%;.
- Wines and other fermented beverages: 8%, depending on the classification of the product.
- Vermouth: 12%;.
- Port, Madeira and Sherry wines: 16%;.
- Rum and spirits from sugar cane, except those made from molasses: 20%;.
- Other distilled beverages: 24%;.
- Cigarettes and cigarettes: 66.7% of the reference value, plus R$3.50 per pack of 20 cigarettes;.
- Other tobacco products: 37.5%;.
- Airplanes: 6.8%;.
- Motor boats in certain classifications: 12%;.
- Other motorized recreational or sports vehicles: 7.8%;.
- Lotto-style games, including gambling and fantasy sports: 0.5%;.
- Extracted mineral products: 0% until December 31, 2027. Supplementary Law no.