Angelo Ambrizzi
Lawyer at Marcos Martins Advogados
Agribusiness is in a prominent position in the national market and, year after year, it consolidates itself as one of the vital sectors for the Brazilian economy.
Even in the midst of the adverse scenario imposed by the pandemic, this was one of the only segments that showed a certain resilience in the face of the challenges felt in the corporate world. In 2020, for example, the sum of goods and services generated reached R$1.98 trillion, according to the Center for Advanced Studies in Applied Economics (Cepea) – an amount equivalent to 27% of Brazil’s GDP.
Faced with such great performance and excellent prospects for prosperity, proper control of the sector’s tax payments is essential if these results are to continue. For this reason, tax planning, which has long been used in other sectors, has become a permanent necessity, with the objectives of maintaining compliance with tax legislation, reducing the tax burden and recovering amounts unduly paid.
Agribusiness has its own tax dynamics, whose taxation changes depending on the structure in which the activity is organized.
The first form of taxation is aimed at individuals (individual rural producers), whose form of accounting is simpler and who are allowed to use the presumption in order to be taxed. Taxes are levied on the amount obtained from sales and there is a tax benefit on payroll.
There is also legislation aimed at rural producers who are legal entities. In this case, payroll taxes are levied as normal – i.e. without benefits. Accounting is at an intermediate level of sophistication, but requires a lot of attention to ensure the expected tax compliance.
Finally, the third form of taxation is levied on the agro-industry. In this case, the company can choose the tax regime – as a rule, presumed profit or real profit. In this segment, tax legislation is complex and the procedures relating to ancillary duties are extensive.
Faced with so many variables, mistakes and inconsistencies are not uncommon, both in the legislation itself and in tax returns, which can lead to significant losses that affect growth, as well as proper financial management.
For this reason, tax planning is an excellent option, enabling better control of the amounts to be paid, the proper analysis of which classification is best (agribusiness, individual rural producer or legal entity) and the mapping of payments made improperly.
In this task, it is clear that legal advice that helps to map out the inconsistencies faced can bring immense benefits, as well as avoiding the formation of tax liabilities that will often only be discovered when an inspection takes place.
The analysis process generally takes between 10 and 30 days, depending on the activity chosen. In carrying out the work, the possible advantages are shown, which can contribute not only to reducing the tax burden, but also to refunding the amount unduly paid over the last five years.
In the midst of an intensely dynamic market, the absence of good tax planning is fatal to the survival of agribusiness. At each turn of the calendar year, the type of tax can be changed and changed again, with a focus on better financial management with the most advantageous taxation possible.
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This year, the sector has the potential to record significant growth, along with an important international trade flow – especially favored by the appreciation of the dollar. Those who are most diligent will definitely gain a greater competitive advantage. So be sure to keep an eye on your tax burden and, above all, get the right legal support to identify the best tax framework for your agribusiness.
About the author:
Angelo Ambrizzi is a lawyer specializing in Tax Law from IBET, APET and FGV with Extensions in Finance from Saint Paul and in Turnaround from Insper and Leader of the tax area at Marcos Martins Advogados.
About Marcos Martins Advogados:
Founded in 1983, Marcos Martins Advogados is highly regarded in the areas of Corporate, Tax, Labor and Business Law. Based on values such as commitment, ethics, integrity, transparency, responsibility and the constant specialization and improvement of its professionals, the firm positions itself as a true partner for its clients.
