Angelo Francisco Barrionuevo Ambrizzi
Lawyer at Marcos Martins Advogados
The Brazilian Federal Revenue Service has been notifying taxpayers to detail how ICMS is excluded from the PIS and COFINS tax base.
The standard notice issued by the Special Delegation for Major Taxpayers ( DEMAC ) asks for clarification as to which ICMS is being excluded from the calculation of PIS and COFINS, whether it is the tax shown on the invoice or the tax actually due after each calculation period.
These announcements derive from RFB Consultation Solution No. 13/2018, through which the Federal Revenue Service issued an official position to the effect that the ICMS to be excluded from the calculation of federal contributions is that actually due in each calculation period, after the taxpayer’s debits and credits have been compared, and not the tax highlighted on the invoices.
This understanding, in practice, harms the taxpayer, reducing the amount to be excluded, and consequently increasing the PIS and COFINS calculation base.
The notices expressly threaten to impose penalties for incorrectly filling in the EFD – Digital Tax Bookkeeping.
The fines for incorrectly filling in the information, provided for in Law No. 8,218/91, are severe and can reach 1% of the value of the legal entity’s gross revenue in the period to which the bookkeeping refers.
This is, therefore, a clear attempt to intimidate taxpayers into complying with the Internal Revenue Service.
It is important to note that this issue of ICMS being excluded from the PIS and COFINS calculation basis has yet to be judged by the STF, as it was the subject of a motion for clarification by the PGFN in the case in which the Supreme Court ruled that ICMS does not form part of the PIS and COFINS calculation basis.
While this is not happening, even if there is a court decision authorizing the exclusion, taxpayers find themselves in a scenario of absolute legal uncertainty, and could be harshly penalized for going against the Federal Revenue Service’s ludicrous understanding that only ICMS due at the end of each calculation period should be excluded from the PIS and COFINS calculation basis.
In this context, Marcos Martins Advogados Associados puts its Tax Law team at the disposal of anyone interested in clarifying doubts about this important issue.
