Section III - federal taxes

Article 153. The Union shall have the power to institute taxes on: I - importation of foreign products; II - exportation to other countries of national or nationalized products; III - income and earnings of any nature;  IV - industrialized products; V - credit, foreign exchange and insurance transactions, or transactions relating to bonds or securities; VI - rural property; VII - large fortunes, under the terms of a supplementary law. Paragraph l - The Executive Power may, observing the conditions and the limits established in law, alter the rates of the taxes enumerated in items I, II, IV and V. Paragraph 2 - The tax established in item III: I - shall be based on the criteria of generality, universality and progressives, under the terms of the law; II - 

Clause II revoked by CA 20, December 15th 1998. Original text read: "II - shall not be levied, under the terms and within the limits established in law, on income deriving from retirement and pension paid by the social security system of the Union, of the states, of the Federal District and of the municipalities, to a person over sixty-five years of age, whose total income consists exclusively of work earnings."

Paragraph 3 - The tax established in item IV: I - shall be selective, based on the essentiality of the product; II - shall be non-cumulative, and the tax due in each transaction shall be compensated by the amount charged in previous transactions; III - shall not be levied on industrialized products intended for export. IV - shall have its impact deducted on the acquisition of productive assets by the taxpayer, in the manner determined by law.

Clause IV added by CA 42, December 19th 2002.

Paragraph 4 - The tax established in clause VI of this article: I - shall be progressive and have their rates determined in such a manner as to discourage the retention of unproductive real property; II - shall not be levied on small tracts of land, as defined in law, when explored by a proprietor who owns no other real property; III - shall be audited and collected by the municipalities which so opt, in the manner prescribed by law, as long as that this option does not imply reduction of taxes or any other means of tax renounce.

Paragraph 4 reworded and amended by CA 42, December 19th 2003. The main modification was the inclusion of the possibility of the municipalities to take over the collection of this tax. The Federal government is the original competent body to collect this tax, but has no resources to do it. The original text read: "Paragraph 4 - The tax established in item VI shall have its rates determined in such a manner as to discourage the retention of unproductive real property and shall not be levied on small tracts of land, as defined in law, when a proprietor who owns no other real property explores them by himself or with his family."

Paragraph 5 - Gold, when defined in law as a financial asset or an exchange instrument, is subject exclusively to the tax established in item V of the caption of the present article, due on the original transaction; the minimum rate shall be one per cent, and the transference of the amount collected is ensured under the following terms: I - thirty per cent to the state, the Federal District or the territory, depending on the origin; II - seventy per cent to the municipality of origin. Article 154. The Union may institute: I - by means of a supplementary law, taxes not instituted in the preceding article, provided that they are non-cumulative and not founded on a taxable event or an assessment basis reserved for the taxes specified in this Constitution; II - in the imminence or in the event of foreign war, extraordinary taxes, encompassed or not by its power to tax, which shall be gradually suppressed when the causes for their institution have ceased.