Brazil's REDATA Tax Regime for Data Centers Reintroduced in Senate After Six-Month Delay
The REDATA proposal, establishing a special tax regime for data centers, is poised for a Senate vote after being stalled for six months. The bill aims to enhance Brazil's competitive edge in attracting investments while addressing energy source eligibility concerns.
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The REDATA initiative (PL 278/2026) is set for a Senate vote following its approval by the Chamber of Deputies on February 25. The proposal allows qualified companies to suspend federal taxes on equipment purchases for five years, contingent on using renewable energy and maintaining fiscal compliance.
Estimated revenue loss for the government is R$ 5.2 billion in 2026, with R$ 1 billion annually for the subsequent two years. The proposal faces obstacles related to budget restrictions and disputes over eligible energy sources, with a coalition of industry organizations advocating for its advancement. The urgency stems from the need to increase Brazil's attractiveness for global data center investments amid rising competition.
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