Brazil · Country watch

Selective Tax Set, Selic Rate Held

Brazil sets new selective tax rates and maintains the Selic interest rate at 13.75%, impacting multiple sectors.

Florent Kalfon · 5 November 2026 · 12 articles read

The picture Stable How this is judged →

Business conditions in Brazil remain stable with the introduction of a new selective tax and the maintenance of the Selic rate. These developments affect costs in retail and automotive sectors, while financial conditions remain unchanged.

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In this briefing Luiz Inácio Lula da Silva · Brazilian Congress · Chilli Beans · Banco Central do Brasil · Confederação Nacional da Indústria

Regulation

Retail
Automotive
Agriculture

Lula's government sets 'Imposto do Pecado' rates

person holding blue labeled bottle — Abstral Official / Unsplash

The Brazilian government has published a provisional measure setting the rates for the new selective tax, known as 'Imposto do Pecado', according to O Globo. This tax, part of the recent tax reform, targets products deemed harmful to health or the environment, such as vehicles, cigarettes, and alcohol. The measure requires approval by Congress to become permanent law. The initial term is 60 days, extendable by another 60 days. The tax is expected to increase costs for these products.

Impact Retailers and manufacturers of vehicles, cigarettes, and alcohol face increased costs due to the new selective tax rates.

Watch The measure requires approval by the Chamber of Deputies and the Senate within 60 days.

Sources: O Globo ↗, CNN Brasil ↗, G1 ↗

Companies

Retail

Chilli Beans launches promotion amid recovery

Chilli Beans, currently undergoing a R$328 million extrajudicial recovery process, has announced a major promotion offering discounts of up to 50% on sunglasses and watches, according to A Tarde. The promotion includes various models with prices significantly reduced, such as sunglasses for R$164.98 and watches for R$219.99. This move is part of the company's strategy to boost sales and improve cash flow amid financial restructuring.

Impact Retail competitors and suppliers to Chilli Beans may experience increased market activity due to the company's promotional efforts.

Sources: A Tarde ↗

Markets

Finance

Banco Central holds Selic rate at 13.75%

The Banco Central do Brasil has decided to maintain the Selic interest rate at 13.75% per year, following five consecutive cuts, according to G1. The decision comes as the first interest rate announcement after President Lula's re-election. Analysts suggest that the pause in interest rate cuts could extend beyond December. The decision has sparked debate among industry leaders, with the Confederação Nacional da Indústria urging a rate cut at the next meeting.

Impact Lenders and borrowers in Brazil face continued high borrowing costs as the Selic rate remains unchanged.

Watch The next Copom meeting is scheduled for 8 and 9 December. · 8 December 2026

Sources: G1 ↗

Nothing significant reported today in Disruption · Internal tension · Safety & health · Trade · Politics.