A 75-year-old Brazilian retiree, who has been living in Cascais since 2017, is fighting for justice against the Federal Revenue Service (IRS) due to a severe eye condition that prevents her from working. Despite winning a lawsuit that deemed the IRS’s tax charge on her retirement benefits illegal, she has spent years awaiting the suspension of this charge and a refund for what she has already paid.
Diagnosed with a serious illness, she has been struggling for seven years to reclaim her income tax, which affects many retired Brazilians abroad. If successful, her case could benefit approximately 4,500 other retirees in similar situations, who collectively face about R$61 million (around 10 million euros) in tax liabilities this year.
Determined to raise awareness, she frequently reaches out to Finance Minister Fernando Haddad and other government officials, as well as members of Congress and journalists. Recently, she even contacted President Luiz Inácio Lula da Silva, pleading for equal treatment under the law for retirees with serious illnesses living outside Brazil.
Her battle centers on a ruling from the 24th Federal Court of the Federal District, which declared that the IRS’s taxation of her pension was unlawful. She argues that Law No. 7,713 of 1988 exempts her from this tax. However, despite this ruling, she continues to face a 25% tax on her income as a resident abroad, while retirees with similar health conditions in Brazil enjoy tax exemptions to help cover their medical expenses.
The Brazilian government has yet to comply with the court’s 2019 decision to halt the tax collection and refund those affected. Documents from the National Institute of Social Security (INSS) reveal that the IRS has acknowledged some irregularities in its tax collection practices. Furthermore, the tax authorities have indicated that this taxation policy may discourage Brazilians from residing abroad to avoid taxes.
Law No. 7,713 of 1988 was established to alleviate the financial burdens of individuals suffering from serious illnesses, recognizing the high medical costs involved. The law lists various qualifying conditions, including cancer, active tuberculosis, mental illness, multiple sclerosis, and severe heart disease, among others.
