Rep. Jorge Goetten (Republicanos-SC) has proposed raising the annual revenue ceiling for Brazil's Microentrepreneur Individual (MEI) to at least R$ 140,000 [2].
The proposal aims to modernize the tax regime to prevent small businesses from stagnating due to outdated limits. By allowing higher earnings, the government hopes to encourage formal growth without forcing entrepreneurs into more complex and expensive tax categories too early.
Goetten, serving as the rapporteur for the special commission on the MEI, said the move is necessary to correct a lag that currently hinders the expansion of small businesses [1]. Under the current rules, the annual revenue ceiling is set at R$ 81,000 [1].
Beyond the financial limit, the proposal includes a change to staffing rules. The new regime would allow MEI owners to hire up to two employees [1]. This is an increase from the current limit, which allows only one employee.
There is currently a discrepancy regarding the exact proposed figure. While some reports cite a minimum of R$ 140,000 [2], other sources indicate a proposed limit of R$ 130,000 [3]. Both figures represent a significant increase over the existing R$ 81,000 threshold.
These changes have sparked concerns within the federal government's economic team. Officials are negotiating a lower value or a phased implementation to mitigate a potential fiscal impact estimated at R$ 50 billion [4]. The administration is seeking a balance between supporting entrepreneurship and maintaining fiscal stability.
The proposal was discussed in the Chamber of Deputies during May 2026 [4]. If passed, the legislation would fundamentally change how millions of independent workers in Brazil manage their taxes, and payroll.
“The proposal aims to modernize the tax regime to prevent small businesses from stagnating.”
The proposal represents a tension between economic stimulus for the 'gig economy' and national fiscal discipline. Raising the MEI ceiling reduces the tax burden for growing businesses, which can spur job creation, but the estimated R$ 50 billion loss in tax revenue could complicate Brazil's broader budgetary goals.
