Alana Aiche do Carmo Dahrouj
Lawyer at Marcos Martins Advogados
A recent decision creates a great opportunity for ICMS taxpaying companies to strategically seek to reduce their tax burden.
The decision handed down by the Judge of the 2nd Public Finance Court of Santo André ordered the São Paulo State Public Treasury to exclude amounts related to PIS and Cofins from the ICMS tax base.
The magistrate’s decision was based on the fact that PIS and Cofins are not part of the value of the goods or services transaction and for this reason should not be included in the ICMS tax base.
This unprecedented decision opens up the possibility for companies to act strategically to reduce ICMS, and they can do so in the following ways:
a) if the company is an ICMS taxpayer and has no outstanding debts, it can file a lawsuit seeking authorization to exclude PIS and Cofins from the ICMS tax base.
b) For companies with ICMS debts, the alternative would be to defend themselves in the respective Tax Foreclosures by reducing the amount owed.
The reduction in the value of ICMS can be as much as 9.25% and can not only boost the company’s cash flow, but also provide a considerable competitive advantage.
Marcos Martins Advogados puts its tax team at your disposal for further clarification on this subject.
