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In the Brazilian macroeconomic context, the historic insufficiency of investment is cited as a structural factor limiting growth, even when GDP expands above 3% per year (3.4% in 2024). Economic literature indicates that the investment-to-GDP ratio should exceed 20% to sustain long-term expansion; however, even in the best cycles, the index reaches only 18%.

The cost of capital in Brazil is another significant constraint: corporate bank loans often exceed 15% p.a., leading private investors to prefer lower-risk, high-return assets such as government bonds and bank certificates of deposit (CDBs) rather than direct financing of the productive sector.

Among the instruments used to stimulate capital formation, the most relevant include:

• attracting foreign investment;
• subsidized credit from public banks, particularly BNDES;
• tax incentives for specific financial instruments.

Within this framework, Federal Law No. 12,431/2011, as amended by Law No. 14,801/24, created incentivized debentures debt securities issued to finance infrastructure projects (sanitation, energy, highways, and railways) with significant tax benefits for investors. The exemption from income tax for individuals and the reduced rate for corporations make these instruments highly attractive, allowing companies to raise funds at lower rates than those offered by the banking system and with maturities better suited to the long implementation cycles of large-scale projects.

Recent data illustrate their success: between 2023 and 2024, total issuances reached BRL 190 billion (USD 35 bn), surpassing all issuances made between 2011 and 2022. In 2024 alone, the volume reached BRL 132 billion (USD 24 bn), a 48% increase compared to 2023 (BRL 64.5 billion / USD 12 bn). The first half of 2025 has already set a historic record, with BRL 74.54 billion (USD 13.5 bn) issued—a 15.7% increase over the same period in 2024.

Provisional Measure No. 1,303, dated June 11, 2025, provides for the reduction or removal of tax benefits starting January 1, 2026. This change is expected to accelerate issuances in the second half of 2025 as issuers seek to secure favorable conditions before the new tax rules take effect.

For issuers and investors, the current environment presents a unique opportunity to structure fundraising with competitive costs, high liquidity, and strategic positioning in the capital markets before the potential revision of the applicable tax regime.