Brazil Enacts Law 15.504 to Boost Data Centers and AI Investment with Tax Incentives
Brazil enacts Law 15.504, offering tax incentives to attract data centers and AI investments, aiming to boost domestic data infrastructure and reduce reliance on foreign storage.
- • Law 15.504 was sanctioned on September 15, 2026, to incentivize data center installation in Brazil.
- • Redata tax regime grants suspensions on import and federal taxes, estimated to save R$ 5.2 billion in 2026.
- • Companies must use renewable energy and serve at least 10% of the Brazilian market to qualify for benefits.
- • The law includes reduced tax obligations for operations in North, Northeast, and Center-West Brazil.
Key details
Brazilian President sanctioned Law 15.504 on September 15, 2026, a legislative measure designed to incentivize the installation of data centers and promote investments in artificial intelligence (AI) within the country. This law addresses a critical issue where about 60% of Brazilian data is currently stored abroad, underscoring the need to enhance domestic data infrastructure to keep pace with the global surge in generative AI technology.
The law establishes the Regime Especial de Tributação para Serviços de Datacenter (Redata), a special tax regime that offers companies significant tax exemptions. These include the suspension of Import Tax, PIS/Cofins, PIS/Cofins-Importation, and Industrialized Products Tax (IPI) on equipment purchases. Redata provides a five-year tax suspension period, conditional on companies using renewable energy sources and complying with federal tax obligations to qualify for the benefits.
The government estimates a tax exemption of approximately R$ 5.2 billion in 2026, decreasing to around R$ 1 billion in the following two years. To further stimulate economic growth in traditionally less developed areas, companies located in Brazil’s North, Northeast, and Center-West regions will face reduced tax obligations.
An important requirement under the law mandates that companies participating in the Redata regime must allocate at least 10% of their data processing services to the Brazilian market. Non-compliance with this obligation will incur penalties. The implementation and oversight of the tax benefits will be managed by the federal government.
This law stems from PL 278/2026 proposed by Congressman José Guimarães and represents a renewed effort after a previous provisional measure failed in Congress. It aims to strengthen Brazil's digital sovereignty, stimulate cloud computing, and accelerate AI development through critical infrastructure investment.
This article was translated and synthesized from Brazilian sources, providing English-speaking readers with local perspectives.
Source articles (2)
Source comparison
Date of law sanctioning
Sources report different dates for when the law was sanctioned
www12.senado.leg.br
"The law was officially published on October 16."
www12.senado.leg.br
"On September 15, 2026, the President of Brazil sanctioned Law 15.504."
Why this matters: One source states the law was sanctioned on September 15, 2026, while the other claims it was enacted on October 16, 2026. This discrepancy affects the timeline of the law's approval and implementation.