The announcement that the selective tax – known as the 'sin tax' – will be charged from February next year generated strong repercussions in the production sector and on social media.
Created by the tax reform on consumption, the 'sin tax' will begin to be charged in February and aims to make products or activities that cause harm to health or the environment more expensive in the coming years.
Next year, the government says that the objective is to maintain the current tax burden on each product, that is, without a tax increase. But some affected sectors have complained that taxes will be higher.
Despite the negative impact of the announcement on society, the sin tax (known as 'sin tax' or 'excise tax' in English) is not an example of a Brazilian 'jabuticaba', that is, something that only exists in Brazil.
According to a 2024 study on consumption taxation by the Organization for Economic Cooperation and Development (OECD), a forum that brings together 38 countries, all nations in the group maintain selective taxes ('excise duties') on tobacco and alcoholic beverages.
The OECD report also includes fuels among products commonly subject to selective taxes. The survey, however, does not provide a consolidated list of countries that adopt this type of fuel taxation.
The study does not include sugary drinks among the main categories analyzed. A 2025 report by the World Health Organization (WHO), however, points out that some countries adopt specific taxes on these products, including the United Kingdom, Mexico, Portugal and France.
In Brazil, the list includes alcoholic beverages, soft drinks and cigarettes. The new tax will also apply to some vehicles, depending on the level of pollution, on the extraction of mineral goods and on lotteries.
The OECD document assesses that selective taxes are widely used to influence consumer behavior and discourage the consumption of products associated with negative impacts on health or the environment — the objective of the Brazilian sin tax.
See how much will be charged in the sin tax in Brazil: sugary drinks: 2.6%; malt beers: 4.2%; wines, sparkling wines, proseccos and champagne (except Madeira, port and sherry wines): 8%; vermouths: 12%; Madeira, port and sherry wines: 16%; ready-to-drink alcoholic beverages, such as canned drinks, with a content above 8%: 16%; rum and cachaça: 20%; whiskey, vodka, gin and tequila among others: 24%; cigarettes: rate of 66.7%, plus R$3.50.
The text establishes, for example, sustainability and energy efficiency criteria for defining the rates applicable to vehicles, aircraft and vessels.
Certain categories of vehicles will have a zero rate, including those purchased by people with disabilities or autism spectrum disorders and by professional drivers who use the car in the rental category (taxi), subject to the conditions set out in the measure.
A survey by Fiocruz, cited by the Ministry of Health, shows that alcohol consumption generated costs of R$18.8 billion in 2019. Of this total, R$1.1 billion corresponded to direct federal spending on hospitalizations and outpatient care in the Unified Health System (SUS). Another R$17.7 billion was associated with lost productivity caused by premature deaths, absence from work, early retirement and sick leave related to diseases caused by alcohol consumption.
In Brazil, according to the Ministry of Health, diseases related to smoking generate indirect costs of R$86.3 billion per year. Also considering direct costs, the annual economic impact reaches R$153.5 billion, equivalent to 1.6% of GDP. 'On the other hand, the collection of federal taxes on the sale of cigarettes is only R$8 billion per year, which highlights an imbalance between health expenditure and the revenue generated by the sale of the product', he says.
In a study to support the collection of the Selective Tax, the government estimated that the treatment of diseases associated with the consumption of ultra-processed drinks, such as soft drinks, isotonic drinks and soft drinks, costs the Unified Health System (SUS) almost R$3 billion per year.
National producers claim that alcoholic beverages are already heavily taxed in Brazil, with taxes representing from 40% to more than 80% of the price of the products. According to the sector, a possible increase in taxation could reduce profit margins, increase consumer prices, cause layoffs and stimulate the illegal market.
