Politics · Brazil · 3 hrs ago
Tax expert urges Senate to set CBS rate at 9.5% to 10%
Brazilian tax law professor Heleno Torres says the Senate should set the CBS rate at 9.5% to 10%, below the 11.3% reference rate calculated by the Federal Court of Accounts.
The CBS, or Contribution on Goods and Services, is part of Brazil’s tax reform and is due to replace PIS and Cofins from January 1.
Torres says the Senate can set the final rate by resolution, and should decide this month so businesses can plan and budget revenue estimates can be more accurate.
He opposes delaying the reform, arguing that some businesses may not be fully ready even if the start date is pushed back.
He says the Federal Revenue Service could help by answering taxpayers’ questions and allowing a period without fines for errors in required filings.
Torres also says the CBS rate should take effect only after a 90-day waiting period from its publication, and that the dates for ending PIS and Cofins could be adjusted if needed.
The Senate’s decision on the rate is still to come.
Tax expert Heleno Torres says the Senate has technical grounds to set the CBS rate between 9.5% and 10%.
That would be below the 11.3% rate calculated by Brazil’s Federal Court of Accounts and consistent with a 26.5% cap in the tax reform law.
Torres urges the Senate to decide the rate this month so businesses can plan and budget revenue estimates can be more precise.
He opposes delaying the tax reform’s planned start, while proposing guidance for taxpayers and a period without fines for some compliance failures.
He also says the CBS should be subject to a 90-day waiting period after its rate is published.
- Who
- Tax expert Heleno Torres, a professor of financial law at the University of São Paulo.
- What
- He urges the Senate to set the CBS rate between 9.5% and 10%, and opposes delaying the tax reform.
- When
- He says the Senate should set the rate this month. The CBS is due to replace PIS and Cofins on January 1.
- Where
- Brazil.
- Why
- He says the proposed rate fits the 26.5% cap in the law and would help businesses plan and improve revenue estimates for the budget.
This story does not have two clearly opposing sides.
The CBS is due to replace PIS and Cofins.
Torres says the Senate should decide the CBS rate.
The budget legislation is due to be voted on with more precise revenue estimates.
- Proposed CBS rate
- 9.5% to 10%
- TCU-calculated reference rate
- 11.3%
- Legislative cap
- 26.5%
- Expert
- Heleno Torres
- CBS waiting period
- 90 days after publication of the rate
What people are saying
The Senate is not obliged to apply the reference rate [set by the TCU]. The constitutional text clearly says: it is for the TCU to define the reference rate and for the Federal Senate, by resolution, to set the final tax rate.
I imagine it should be between 9.5% and 10%.
Nobody can stand living with PIS and Cofins any longer.
We cannot wait until everything is 100% ready. It is not 100% ready today. It will not be ready to enter in 2028 either.