President Luiz Inácio Lula da Silva delivered a legislative project to raise the annual revenue ceiling for Individual Micro-Entrepreneurs (MEI) on May 29, 2026 [4].
The proposal aims to expand the growth capacity of small entrepreneurs by increasing their revenue limits and allowing them to employ more than one worker. This shift would allow small businesses to scale without immediately losing the tax and administrative benefits associated with the MEI status.
The project outlines a phased increase in the annual revenue ceiling. The current limit stands at R$81,000 [1]. Under the new proposal, this limit would rise to R$110,000 in 2027 [2] and further increase to R$140,000 in 2028 [3].
Lula presented the project to Hugo Motta, the president of the Chamber of Deputies, during a meeting in Brasília. The government said these changes are intended to support the broader agenda of empowering small-scale business owners across the country.
Legislative groundwork for the change began earlier this year. On April 16, 2026, Motta announced the creation of a special commission to study the increase of the MEI limit [5].
"determinei criação de comissão especial sobre aumento do limite do MEI," Motta said regarding the initial steps to review the regulations [5].
The proposal specifically addresses the hiring restrictions currently placed on MEIs. By allowing these entrepreneurs to hire more than one employee, the government seeks to stimulate job creation at the grassroots level, a move intended to reduce the transition friction between micro-entrepreneurship and small business ownership.
“The current limit stands at R$81,000.”
This legislative move represents a strategic effort to modernize Brazil's simplified tax regime for the self-employed. By raising the revenue ceiling and easing hiring restrictions, the government is attempting to prevent 'growth traps' where entrepreneurs intentionally limit their revenue to avoid the higher tax brackets and bureaucratic burdens of larger business categories. If passed, this could lead to a significant increase in formal employment and a larger base of sustainable small businesses.
