MEI Under the Tax Reform: What Changes for the Individual Micro-Entrepreneur
Understand what changes for the MEI (individual micro-entrepreneur) after Brazil's Tax Reform (LC 214/2025): simplified regimes, the Nano-entrepreneur and tax planning.
Executive Summary: Brazil’s Tax Reform (LC 214/2025) creates the figure of the Nano-entrepreneur and reorganizes the simplified taxation system. For the MEI (individual micro-entrepreneur), new questions arise: does the simplified regime still pay off? Does the MEI need to migrate to another structure? This guide answers in plain language.
What the MEI Is and Why It Matters
The MEI (individual micro-entrepreneur) was created in 2008 to formalize low-revenue businesses. Today, an MEI can earn up to R$ 81,000 per year (adjusted figure) and pays a fixed monthly amount that includes simplified INSS, ISS and ICMS. It is the simplest way to stay compliant for small service providers, vendors and artisans.
With the reform, the government proposes to simplify life for micro-businesses even further and creates the figure of the Nano-entrepreneur, with its own rules that may coexist with the MEI or serve even smaller profiles, depending on the final regulation.
What Changes for the MEI Under the Reform
LC 214/2025 introduces the CBS (replacing PIS and COFINS) and the IBS (replacing ICMS and ISS). For the MEI, the big question is whether the fixed monthly amount continues to exist or whether the Nano-entrepreneur will face a different form of taxation.
Following the logic of the proposal, the Nano-entrepreneur tends to have an even more simplified collection than the current MEI, with CBS and IBS integrated in a reduced format. The details on brackets, amounts and operation still depend on regulation.
Practical example: Carla is a manicurist and works as an MEI, issuing invoices of R$ 4,500 per month. Today, she pays around R$ 70 per month in DAS (the Simples Nacional collection document). With the reform, if Carla becomes a Nano-entrepreneur, the amount collected may be even lower, but the calculation base of the new system needs to be verified.
Is the MEI Still Worth It?
For many MEIs, the simplified regime will remain the best option. The key is to compare:
- Current MEI: fixed monthly amount + right to retirement and INSS benefits
- Proposed Nano-entrepreneur: a simplified regime whose final form still depends on regulation
- Simples Nacional (simplified tax regime): if revenue grows, migrating may be worthwhile
Practical example: Roberto is an MEI electrician and earns R$ 6,500 per month. When his annual revenue exceeds the MEI ceiling, he will need to migrate to Simples Nacional (simplified tax regime) or another structure. With the reform, the migration may be smoother in terms of tax credit — but each case must be analyzed individually.
MEI vs. Nano-entrepreneur vs. Simples Nacional Comparison
What to Do Now as an MEI
- Follow the regulation: the definitions of the Nano-entrepreneur still need to be detailed in the supplementary rules.
- Don’t wait to formalize: if you are not yet an MEI, the reform should not change the decision to formalize.
- Keep control of your revenue: proper documentation is essential for any regime transition.
- Seek tailored guidance: each activity has specific rules.
Want to understand how the Tax Reform affects the MEI and the new Nano-entrepreneur? At /en/napratica, VMAHUB publishes practical guides for businesses. For a personalized analysis of your case, talk to our team: [email protected]
Read also:
- Nano-entrepreneur: The New Legal Figure
- Simples Nacional Under the Tax Reform
- Individual vs. Company (PF x PJ) Under the Tax Reform
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