Tax Burden in Brazil 2025: International Comparison and expectations

Brazilians work 149 days a year just to pay taxes. That's almost 5 months of work dedicated exclusively to financing the State.

If you feel that your company pays too much and receives too little in return, the data confirms: you are right. Brazil lives a fiscal paradox where the tax burden is worthy of a developed country, but the return to society is one of the worst in the world.

In this definitive article, we analyze real numbers from 2024-2025, compare Brazil with major global economies, and explain how the Tax Reform (LC 214/2025) will drastically alter this scenario — for better or for worse.

1. The Current Situation: Numbers Every Entrepreneur Needs to Know

To make strategic decisions, you need to go beyond guesswork and look at the cold hard data. The Brazilian tax burden is not only high; it is complex and poorly distributed.

Tax Burden in 2024: The Real Weight

According to consolidated data from the National Treasury and the Internal Revenue Service (Receita Federal), the Brazilian tax burden reached 32.32% of GDP in 2024. Some methodologies, such as FGV's (which includes System S and other contributions), place this number even higher, reaching 34.24%.

But the datum that impacts daily life most is the work time required to settle these obligations. The annual study by IBPT (Brazilian Institute of Planning and Taxation) reveals that, in 2024, Brazilians worked until May 28th just to pay taxes.

How is the Burden Composed?

The Brazilian system punishes consumption and production, which directly affects company competitiveness. See the distribution of the 149 days of work:

83 days

Consumption (56%) - PIS, COFINS, ICMS...

55 days

Income (37%) - IRPJ, CSLL, IRPF

11 days

Property (7%) - IPTU, IPVA

This concentration on consumption makes products and services more expensive, generating the so-called "Brazil Cost".

2. Brazil in the World Ranking: How Do We Compare?

We frequently hear that "Brazil has the highest tax burden in the world". This is not technically true, but the reality is more subtle — and perhaps more worrying.

If we compare only the percentage of GDP, Brazil would be in the 14th position among OECD countries (Organisation for Economic Co-operation and Development), if it were a member.

See the comparison with data from OECD Revenue Statistics 2025:

Critério	Country	Tax Burden (% GDP)
🇩🇰 Denmark	45.2%	Highest in OECD
🇫🇷 France	43.5%	Robust welfare state
🇮🇹 Italy	42.1%	High public debt
🇧🇷 <strong>BRAZIL</strong>	<strong>~34%</strong>	<strong>Rich country level</strong>
🇨🇭 Switzerland	28.5%	Global financial hub
🇺🇸 USA	26.7%	Focus on economic dynamism
🇰🇷 South Korea	~28%	Industrial and tech power

Brazil charges more taxes than Switzerland, the United States, and South Korea.

The Brazilian Paradox

1. Complexity

Brazilian companies spend about 2,000 hours per year to calculate and pay taxes (World Bank). The OECD average is less than 200 hours.

2. Regional Inequality

In Latin America, the average tax burden is 21.3%. Brazil, with its 33-34%, is an outlier, charging 50% more than its neighbors, which reduces our regional competitiveness.

3. The IRBES Index: Why Is the Return So Low?

Here we reach the heart of the Brazilian entrepreneur's and citizen's frustration. We pay "first world" taxes, but receive services of...

The IRBES (Index of Return of Well-being to Society), calculated by IBPT, crosses the tax burden with the HDI (Human Development Index). The goal is to measure State efficiency: how much well-being is generated for each unit of tax collected.

Critério	Ranking	Country	Burden/GDP
1st	🇮🇪 Ireland	23.0%	Excellent
2nd	🇨🇭 Switzerland	28.5%	Excellent
3rd	🇺🇸 USA	26.7%	Very Good
...	...	...	...
29th	🇦🇷 Argentina	~29%	Low
<strong>30th</strong>	<strong>🇧🇷 BRAZIL</strong>	<strong>~34%</strong>	<strong>LAST</strong>

While Switzerland charges 28.5% of GDP and delivers one of the best qualities of life on the planet (2nd place in return), Brazil charges 34% and delivers precarious public services.

According to the OECD, Brazilian satisfaction with the health system is only 45%, while the average for developed countries is 68%.

Brazil is a global "case" of tax inefficiency. We collect a lot, spend poorly, and return little.

4. Tax Reform (LC 214/2025): What Changes in the Burden?

The Tax Reform, regulated by Supplementary Law 214/2025, promises to simplify the system. But will it reduce the burden?

The End of the "Alphabet Soup"

Extinguished Taxes

Federal: PIS, COFINS, IPI

State/Municipal: ICMS, ISS

New Taxes (Dual VAT)

CBS (Federal): ~8.8%

IBS (State/Municipal): ~17.7%

IS (Selective Tax): "Sin tax"

The New World Record

The sum of rates (CBS + IBS) should hover around 26.5% to 28.55%.

Winners and Losers?

The reform alters the taxation logic from origin to destination and ends cumulativity.

Industry

Tends to gain, as it can utilize tax credits more broadly.

Services

Tends to feel an increased burden, as it has few credits to offset.

Agribusiness

Maintains favored regimes, but with new compliance rules.

The International Monetary Fund (IMF), in its 2024 analysis, was optimistic: it stated that the reform "should boost productivity, foster formal employment, and improve tax equity". But for your company, the impact depends on your regime and sector.

5. Strategies for Companies: How to Navigate This Scenario

Facing a 34% tax burden and the biggest fiscal change of the last 50 years, passivity is an incalculable risk.

Conclusion: Turn Cost into Strategy

The Brazilian tax scenario of 2025 is challenging. We have a high burden, low social return, and a structural reform underway.

You cannot control the rate the government sets. But you can control your company's tax efficiency.

Need a clear diagnosis of your fiscal situation? OSP Accounting specializes in transforming tax complexity into business solutions.