PM 1,318: The Special Tax Regime For Data Centers (REDATA) From Tax, Environmental, And Energy Perspectives

• Published date: 02 October 2025
• Law Firm: Mayer Brown
• Author: Diego Miguita, Débora Yanasse, Alexandre Arlota, Luiz Gustavo Bezerra, Gedham Gomes, Raphael Furtado and Luisa Tortolano Barreto

In September, Provisional Measure No. 1,318 was published, establishing the Special Tax Regime for Data Center Services (REDATA). The Federal Government had outlined the main features of the program earlier this year, and the measure is overall consistent with market expectations for greenfield projects and the expansion of data centers in Brazil.

Legal entities implementing projects for the installation or expansion of data center services in the country may apply for REDATA. Authorization will be granted upon request to the Brazilian Federal Revenue Service (RFB), with proof of compliance with the applicable requirements (outlined below), and will not be automatic. The measure also provides for co-authorization and extends incentives to suppliers of goods and services linked to the beneficiary's project, exclusively in operations and contracts directly related to the authorized scope.

Although provisional measures produce immediate effects, in the case of REDATA, the mechanism for granting tax incentives and verifying compliance is subject to regulation by the RFB and prior authorization of the applicant. Until such regulation is issued and authorization granted, no benefits apply to acquisitions. As with any provisional measure, there is also the possibility that the project will not be converted into law, or may be amended by Congress.

Tax benefits

Tax exemptions on the acquisition, whether domestic or imported, of electronic components and other information and communication technology products destined for the project's fixed assets are to be listed in an act of the Federal Executive Branch. These include:

• PIS/COFINS and PIS/COFINS-Importation;
• Excise Tax (IPI); and/or
• Import Tax (II), subject to the absence of a national equivalent, to be verified under...