Tax reform: international purchases will have to pay future consumption tax | Economy

Purchases by Brazilians abroad of up to US$50, who currently do not pay federal taxes, such as import taxes, PIS and Cofins, will normally be taxed by future consumption taxes (CBS and IBS — federal, state and municipal VAT ).

The information was released this Thursday (25) by the extraordinary secretary for tax reform at the Ministry of Finance, Bernard Appy. According to him, the so-called standard rate will be charged — also applicable to the domestic market –, estimated at 26.5%.

“IBS and CBS will be collected at a standard rate. All values, any value. In the new model, any international remittance pays tax. It’s the concept of neutrality. Basically, the states are already talking about raising the rate, not It’s going to look very different from what it is today,” Secretary Appy told reporters.

The decision to normally tax purchases from abroad is in a bill to regulate the tax reform on consumption – which was sent to the National Congress this week.

The Treasury’s schedule predicts that the regulation will be made between 2024 and 2025. With the end of this phase, the transition from current taxes to the Value Added Tax (VAT) model — with non-cumulative charging – could begin in 2026.

The exemption from federal import tax is applied as long as companies adhere to a compliance program, called “Compliant Shipping”. If they don’t join, they pay 60% import tax – the same amount charged for orders over US$50.

• According to data from the Federal Revenue, Brazilian consumers spent R$6.42 billion on a total of just over 210 million international orders in 2023.
• In 2022, around R$2.57 billion were spent on 178.6 million purchases from abroad. The amount spent is less than half the 2023 amount.
• With the new program, the Federal Revenue reported that there was a “significant increase” of 1,596% in total import declarations for postal shipments (through the Post Office) in 2023.

Although the federal import tax rate is currently zero, the economic team has informed that it will increase taxation in the future.

If this happens, taxes on international orders will be even higher. To date, however, federal taxation (import tax) is still zero.

• In the middle of last year, the Minister of Finance, Fernando Haddad, stated that the measures announced at that time for e-commerce represented only the beginning of the regularization process, and indicated that there will be taxation through federal taxes in the future.
• In September 2023, the executive secretary of the Ministry of Finance, Dario Durigan, informed that the federal government is considering establishing an import tax starting at a level of 20% in the process of regularizing orders coming from abroad.
• In February 2024, the Federal Revenue Secretary, Robinson Barreirinhas, denied that the agency was delaying in defining the import tax for orders under US$50 from abroad, purchased through websites.

In a technical note released last year, the Federal Revenue Secretariat estimated that the exemption for international purchases of up to US$50, if maintained by the federal government, will result in a “potential loss” of revenue of R$34.93 billion by 2027 .

In February this year, more than 40 entities in the Brazilian retail sector released a manifesto against the Federal Revenue Service’s delay in taxing imports via e-commerce.

Among those who signed the document are the Institute for Retail Development (IDV), Força Sindical, Eletros and the Center for Industries of the State of São Paulo (Ciesp).

“The government’s delay in deciding on the end of the exemption from federal taxes for sales of up to 50 dollars on international e-commerce platforms is unjustifiable, the effects of which are still being analyzed by the Ministry of Finance, as has been reported in the press. There is no more to assess, considering the very clear harmful effects of this benefit on national industry and retail, resulting from the lack of tax equality”, the entities assessed in February.

These entities warn that Mother’s Day, in May, is approaching, considered a “date of extreme commercial importance, meaning significant proportional revenue in the companies’ annual balance sheet”. And they add: “If the tax exemption for international platforms is maintained, the harmful effects will be even more serious.”