The Brazilian Institute of Oil, Gas and Biofuels (IBP) expresses deep concern over recent reports regarding the possibility that the Federal Government may maintain the Export Tax on crude oil, even in the event that Provisional Measure 1,340/2026, which established its collection, loses effectiveness.

The maintenance of the Export Tax, even with a gradual reduction in rates depending on Brent’s evolution, will increase the economic impacts on production projects and on the investment plans of oil-producing companies, and will amount to a continuation of the unconstitutionality that characterizes this tax, given its openly revenue-raising nature, further increasing legal uncertainty in the country.

It is worth noting that the Brazilian tax system already has a mechanism to capture increases in international oil prices, which makes the export tax redundant, unnecessary, and unjustified.

The loss of effectiveness of the Provisional Measure is a natural consequence of the legislative process provided for in the Federal Constitution and highlights the importance of the oversight exercised by the National Congress over provisional measures issued by the Executive Branch. Any attempt to maintain, through administrative acts, a tax policy conceived in a provisional measure that will not survive in the legal order undermines the constitutional role of the Legislative Branch by failing to deliberate on the Provisional Measure.

The oil and gas sector requires highly capital-intensive investments, carried out over long-term horizons and based on stable legal rules. In addition, oil is one of the main products in Brazil’s export basket and accounts for a significant share of foreign exchange generation, the trade balance surplus, and the collection of government participations, already contributing strongly to fiscal balance.

IBP reiterates its willingness to contribute to the Federal Government and to the National Congress in building solutions that reconcile fiscal responsibility, regulatory stability, legal certainty, and international competitiveness.