Taxation on LCAs threatens agricultural credit, warn parliamentarians

The Parliamentary Front for Agriculture (FPA) has harshly criticized the federal government's proposal to tax at 5% the income from Agribusiness Credit Notes (LCAs) and Real Estate Credit Notes (LCIs), currently exempt for individuals. The measure threatens private rural credit, used by medium-sized producers and cooperatives, in a scenario of high interest rates and falling commodity prices.

According to the FPA, the increase in financing costs will be passed on to the end consumer, with an increase in food prices. Currently, around 42% of Brazilian rural credit comes from the private sector. Of this amount, 43% comes from LCAs.

In April 2025, the volume of these letters reached R$559,9 billion. Added to the total stock of LCIs and LCAs on B3, which reached R$979,1 billion in the first quarter of the year, the impact of the measure is considered significant for the financing of the harvest.

The FPA accuses the government of focusing only on revenue collection, without addressing mandatory expenses or reviewing privileges. It points to unequal treatment in the exemption of financial securities, without clear criteria.

Parliamentary coalitions from the productive sector also spoke out. They denounced the tax escalation, with 24 tax increases or creations since January 2023, an average of one new tax every 37 days. The group claims that the increase in the IOF and the end of the exemption for LCIs and LCAs are part of an ineffective tax strategy that undermines investment capacity and job creation.

The manifesto advocates an end to the policy of tax increases, immediate cuts in public spending and administrative reform. It criticizes the inaction of party leaders in the face of the “tax escalation” and calls on Congress to react in defense of national production.