Brazil: Resolving ICMS liability (São Paulo) | KPMG | GLOBAL

Brazil: Installment program for resolving ICMS liability (São Paulo)

Brazil: Resolving ICMS liability (São Paulo)

The Brazilian state of São Paulo has established a program that allows for the settlement of ICMS tax liabilities with reductions in penalty and interest assessments.

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The ICMS—Imposto sobre Circulação de Mercadorias e Serviços—is a state-level sales tax imposed on the physical movement of merchandise. The ICMS is also levied on certain inter-state and inter-municipal services.

Decree 62.709 / 2017 establishes a special installment program (Programa Especial de Parcelamento (PEP)) for taxpayers to settle their tax debts related to ICMS. São Paulo taxpayers that participate in the PEP may obtain a partial waiver of interest and penalties related to their ICMS liabilities. Under the PEP measures, taxpayers can reduce 75% of applicable penalties and 60% of interest if the outstanding ICMS liability is paid in a single installment. The penalties and interest amounts are reduced to 50% and 40%, respectively, if the taxpayer pays off the outstanding ICMS liability in installments, over 60 months.

The tax liabilities available under the PEP related to transactions or events occurring up to 31 December 2016.

 

Read a July 2017 report (Portuguese) prepared by the KPMG member firm in Brazil

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