In more detail
1. Complementary Law 204/23
LC 204/2023 provides for the nontaxation of ICMS on transfers to the establishment of the same legal entity and assures the rights to keep the corresponding tax credits, including on interstate transfers.
The veto by the President of the Republic was in relation to the provisions of § 5 of PLP 116, which allowed taxpayers to keep the transaction as taxed, similarly to the procedure before the ADC 49 ruling.
In addition to that, ICMS Agreement No. 225, of 21 December 2023, was also published this week, dealing with the obligation to transfer credits, as provided ICMS Agreement No. 178/2023.
The publication of LC 204/2023 must be interpreted in light of ADC 49 trial, especially with regard to the mandatory transfer of credits. There are also relevant points in connection with ICMS Agreements 178 and 225/2023.
Finally, it is worth mentioning that the veto may be reanalyzed by the National Congress, with no scheduled session yet set.
2. Provisional Measure 1202/23
A. Social Security Contribution: creates a new benefit in relation to the reduction of the social security contribution – CPP rate on payroll and revokes the benefits of the CPRB, which had been extended until 2027, with effect from 1 April 2024.
The new rule instituted the partial exemption of the social security contribution on payroll (reduction of the CPP rate), so that companies whose CNAEs are listed in Annexes I and II of the MP will be able to apply reduced CPP rates, as follows:
| Year |
Rate of companies in Annex I activities I |
Rate of companies in Annex II activities II |
| 2024 |
10% |
15% |
| 2025 |
12.5% |
16.25% |
| 2026 |
15% |
17.5% |
| 2027 |
17.5% |
18.75% |
Note that the CNAEs covered by the new benefit are partially different from those previously encouraged by the CPRB.
Such rates will be applied to the insured’s contribution salary up to the value of one minimum wage, and the application is conditional on maintaining the number of employees (equal to or greater than) that verified on 1 January of each year.
B. Tax offsetting: The Provisional Measure established a monthly limit to the offsetting of tax credits arising from a final court decision. Such limit will be established by an act of the Minister of State for Finance (not yet published).
The monthly limit will be graduated according to the total amount of the credit, and cannot be less than 1/60th of the total amount of the credit, updated on the date of submission of the first declaration, and will not apply to credits below BRL 10,000,000.00 (10 million reais).
It is also determined that the first offsetting statement must be submitted within five years.
C.PERSE: Revocation of article 4 of Law 14.148, which instituted PERSE, a program aimed at companies in the events industry that reduced the rates of PIS/Pasep, Cofins, CSLL and IRPJ to zero. PERSE will gradually be phased out with the gradual resumption of the collection of taxes previously exempted.
3.IN 2168/23
The main points covered by IN 2168/2023 are discussed below:
| Debts covered in the program |
- Debts constituted between 30 November 2023 and 1 April 2024.
- Debts not yet established until 30 November 23023 (confessed by rectifying the corresponding ancillary obligations and accounting book-keeping).
- Debts arising from administrative proceedings and decision that do not fully or partially ratify the declaration of offsetting, which come to be constituted between 30 November 2023 and 1 April 2024.
|
| Options to join the program |
- By confession and payment.
- Payment and installments of the full amount.
|
| Discounts |
100% discount in penalties and interest, provided they are paid as follows:
- At least 50% of the debt in lump sum in cash.
- The remainder in up to 48% successive monthly installments, plus interest.
|
| Conditions for the payment |
Use of credits of judicial order of payments.
Use of Tax Losses and negative calculation bases of the Social Contribution on Net Profits (NOLs) to settle the debt, limited to 50% of the amount of the debts.
|
| Tax Clearance Certificate |
Taz debts covered by self-regularization will not be an obstacle for the renewal/issuing of the Tax Clearence Certificate. |
| Deadline |
From 2 January 2024 until 1 April 2024. |
| Tax benefits |
Provision for non-taxation by IR/CS (CIT) and PIS/COFINS (Turnover Taxes) |
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