The Chamber of Deputies approved the regulation of the tax reform this Tuesday (17/12). Complementary Bill (PLP) 68/2024 had already returned from the Senate with changes. Now the text goes to the President for sanction.
The reform aims to simplify taxes in Brazil. The new taxation system will consist of the following taxes:
- PIS/Cofins will be replaced by CBS (Contribution on Goods and Services), which will be levied on transactions involving material and immaterial goods and services, and is the responsibility of the Union.
- ICMS/ISS will be replaced by IBS (Tax on Goods and Services), which will also apply to transactions involving material and immaterial goods and services, but will be managed by states and municipalities.
- IPI will be replaced by IS, a Selective Tax under the jurisdiction of the Union, which will be levied on the extraction, production, import and sale of goods and services that are harmful to health and the environment.
The version approved by the Chamber presented changes such as:
- refund of 100% of CBS and 20% of IBS on energy, water, gas and telecommunications bills for low-income people;
- maximum rate of 0,25% for minerals – against the maximum of 1% stipulated by the constitutional amendment;
- 30% reduction in taxes for pet health plans; all medications not listed at zero rate will benefit from a 60% reduction in the general rate; and
- foreign tourists will receive a refund of these taxes on products purchased in Brazil and carried in their luggage;
- maintenance of the 8,5% rate for Football Corporations (SAF).
The transition period of the Tax Reform will begin in 2026 and will be completed in 2033. There will be no changes in tax collection in 2025. From 2026 onwards, Brazil will enter a transitional regime with two tax systems. In 2027, PIS/Cofins will be abolished, and between 2029 and 2033, ICMS and ISS will be discontinued.
In September, the Canal Solar interviewed Ricardo Ferreira da Costa, Senior Indirect Tax Manager at Ernst & Young, who explained the possible impacts of the Reform on the photovoltaic sector. Click here to check it out.
According to ABGD (Brazilian Association of Distributed Generation), the result of the reform was a victory for the sector. Article 28 defined that the energy generated and compensated will not be taxed by IBS and CBS, benefiting micro and mini generators. In addition, Article 260 states that there will be a 70% reduction in rates for operations essential to the sector.
“All of this is the result of a lot of dialogue and coordination with political leaders, demonstrating ABGD’s commitment to seeking sustainable advances for the sector,” the association declared on its social media.
all the content of Canal Solar is protected by copyright law, and partial or total reproduction of this site in any medium is expressly prohibited. If you are interested in collaborating or reusing part of our material, please us by email: [email protected].
