IOF on FX: the decree back-and-forth, the Supreme Court ruling and the rates in force at the end of July 2025
In two months, the IOF tax was raised by decree, overturned by Congress, suspended by the Supreme Court and restored almost in full. Here is what applies now to FX and corporate credit.
Historical reference: July 29, 2025. Published on this site on November 2, 2026. Dates in the text identify the period covered.
In this article
Key points
- The decree that raised the IOF was published in May, reduced in June, overturned by Congress on June 25, suspended by the Supreme Court (STF) on July 4 and restored almost in full by Justice Alexandre de Moraes on July 16.
- Only the charge on risco sacado (reverse factoring) was left out. The other changes apply, including the 3.5% rate for remittances abroad with no specific rule and for cash.
- On July 18, Moraes clarified that the higher rates do not apply retroactively to the suspension period, July 4 to 16.
- The decision is individual (monocratic), and the STF full court may still review it. Confirm the rule that applies to your operation with your bank or accountant.
Brasília, July 29, 2025 — The IOF (Brazil's tax on financial operations) on foreign exchange changed four times in two months. Anyone who pays a foreign supplier, sends money abroad or takes out credit could read opposite headlines in the same week. This text gathers what applied at each stage and what is in force today. The start of the story, the May decree, is in Decree 12,466 and the IOF for importers. Here the focus is the outcome.
- IOF on remittances abroad with no specific rule, cash and cards
- 3.5%
- Votes in the Chamber of Deputies that overturned the decree, on June 25
- 383 to 98
- Period of suspension by the STF (July 4 to 16), with no charge of the higher rates
- 12 days
- 2026 revenue that the government says it loses with the exclusion of risco sacado
- R$3.5 bn
The IOF timeline in 2025
- May 22 and 23Decree 12,466 raises the IOF on foreign exchange, credit and private pension plans. Decree 12,467, the next day, backtracks on two points. The changes apply from May 23.
- June 11Decree 12,499 replaces the May decrees. It lowers the cap on corporate credit IOF from 3.95% to 3.38% a year, zeroes the rate on the return of foreign investment and keeps the 3.5% on foreign exchange. It applies from June 12.
- June 25The Chamber of Deputies approves, by 383 votes to 98, the bill that overrides the decrees. The Senate approves it the same night, by symbolic vote. It is the first time in 33 years that Congress overturns a presidential decree, according to O Povo.
- July 4Justice Alexandre de Moraes, of the STF, suspends both the government's decrees and Congress's decree and calls a conciliation hearing.
- July 15The hearing ends without agreement, and the parties ask the STF to decide.
- July 16Moraes restores almost the whole decree, except the charge on risco sacado. The decision is monocratic, and the full court may still review it.
- July 17 and 18Brazil's Federal Revenue Service (Receita Federal) resumes collection on July 17 and exempts banks from retroactive payment. On July 18, Moraes clarifies that the higher rates do not apply to the suspension period.
What the Supreme Court decided
Moraes found that the government could raise the IOF by decree, since it is a regulatory tax, but that it exceeded its authority by treating risco sacado as a credit operation. In risco sacado (reverse factoring), the bank advances to the supplier the payment for a purchase on credit made by a company. That part of the decree remains without effect.
The government estimates it will lose R$450 million in 2025 and R$3.5 billion in 2026 with the exclusion. The rest of the decree, in the June 11 version, applies again. Because the decision is individual, the STF full court may still confirm or change it.
Moraes wrote on July 18 that, for legal certainty, the higher rates do not apply retroactively to the period in which the decree was suspended. The Receita Federal said it will not charge financial institutions retroactively. Anyone who paid extra IOF in that interval should contact their bank or accountant.
Rates in force at the end of July 2025
| Operation | Before May | In force |
|---|---|---|
| Outflow of funds with no specific rule (services, royalties) | 0.38% | 3.5% |
| Cash and remittance to one's own account abroad (except investment) | 1.1% | 3.5% |
| Remittance to one's own account abroad for investment purposes | 1.1% | 1.1% |
| Credit and debit card abroad, prepaid card and traveler's check | 3.38% | 3.5% |
| Foreign loan with an average term of up to 364 days (inflow) | 0% | 3.5% |
| Inflow of funds with no specific rule | 0.38% | 0.38% |
| Return of foreign investment (dividends, interest on equity and capital reduction) | 0% to 0.38% | 0% |
| Credit for companies in general (annual cap, with an additional 0.38%) | 1.88% | 3.38% |
| Credit for Simples Nacional companies, up to R$30,000 (annual cap) | 0.88% | 1.38% |
| Risco sacado | exempt | exempt (excluded by the STF) |
The table follows the text of Decree 12,499, the law firm Lefosse's guide to it and the reports by Exame and Mercado & Consumo on the STF decision. Corporate credit pays 0.0082% a day plus a fixed 0.38%, which gives the cap of 3.38% a year. For companies in the Simples Nacional (the simplified tax regime for small businesses), including microentrepreneurs (MEI), in operations of up to R$30,000, it is 0.00274% a day plus the same 0.38%, a cap of 1.38%. Part of the press still repeats the 1.95% of May, which the June decree reduced. Credit for individuals did not change.
The decree has no rate of its own for paying for imported goods. For that reason, firms such as Demarest place it among the unspecified remittances (item XXIV of art. 15-B), at 3.5%, alongside services and royalties. Confirm with your bank, customs broker or accountant which item applies to your operation before closing the exchange.
What changes for importers
- Cost. In operations taxed at 3.5%, the IOF is 3.12 percentage points higher than the 0.38% before May. On a US$50,000 payment, that is about US$1,560 more (3.12% of US$50,000), before spread and fees.
- Working capital. The IOF cap on corporate credit rose to 3.38% a year. Review advance contracts and short-term lines.
- Dates. Operations settled between July 4 and 16 do not pay the higher rates. Operations before July 4 and from July 17 follow the table.
- Total cost comparison. The IOF enters the calculation alongside spread, bank fees and network fees. See the method in SWIFT or USDT: cost and timing.
The picture may change again: the STF full court may still review the decision, and the government and Congress continue to negotiate revenue measures. For pricing decisions, use the table as a reference and confirm the rate in the bank's quote, which states the IOF before the exchange is closed.
Frequently asked questions
What is the IOF on foreign exchange in force in July 2025?
The general rate for outflows with no specific rule, cash and international cards is 3.5%. Remittances to one's own account abroad for investment purposes pay 1.1%. Inflows with no specific rule pay 0.38%. Confirm how your operation is classified with your bank.
Did the Supreme Court keep the IOF increase?
On July 16, 2025, Justice Alexandre de Moraes restored almost the whole decree, except the charge on risco sacado. The decision is individual (monocratic), and the full court may still confirm or change it.
Does the new IOF apply to operations from July 4 to 16?
No. On July 18, Moraes clarified that the higher rates do not apply retroactively to the period in which the decree was suspended. The Receita Federal said it will not charge banks retroactively.
What is risco sacado and why was it left out?
It is the operation in which a bank advances to the supplier the payment for a purchase on credit made by a company. The decree treated this operation as credit and taxed it. Moraes found that the Executive could not make that equivalence by decree.
Found it useful? Share it with anyone who pays suppliers abroad.
Sources
- Decreto nº 12.499, de 11 de junho de 2025 · Presidência da República, Jun 11, 2025
- O IOF voltou: o que muda · Exame, Jul 17, 2025
- Entenda como fica o IOF após decisão de ministro do STF · Mercado & Consumo, Jul 18, 2025
- Governo revoga alterações no IOF com novo decreto: guia completo · Lefosse, Jun 13, 2025
- Congresso susta alta do IOF e derruba decreto pela 1ª vez em 33 anos · O Povo, Jun 26, 2025
- Moraes suspende atos sobre IOF e convoca conciliação entre governo e Congresso · InfoMoney, Jul 4, 2025
- Moraes esclarece que IOF não terá cobrança retroativa para contribuintes e bancos · Gazeta do Povo, Jul 18, 2025
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