States establish 17% ICMS rate for purchases from international retailers
Implementing the change is part of the government's strategy to import sales tax from foreign retailers such as Shein and AliExpress. It is also planned to hold meetings of technical groups to discuss the details of the implementation of this measure.
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Last Tuesday (30), the National Committee of Finance Secretaries of the States and the Federal District (Comsefaz) took a unanimous decision to adopt a rate of 17% for the Tax on Circulation of Goods and Services (ICMS) applied to purchases made on online platforms of international retailers. This decision was formalized by the Ministry of Finance on Thursday (1st). In the coming days, a meeting is scheduled between the technical groups of the states and the federal government to discuss the matter, according to the director of the committee, André Horta.
“We will proceed with negotiations on supporting legislation to implement this new procedure, which will give competitiveness and equalization of tax treatment to the national company”, said Horta.
According to the director of Comsefaz, the standard rate of 17% is not yet in effect due to the need to edit an ICMS agreement before implementing this change.
Aliquot
Currently, the rates used in this type of transaction vary from state to state. According to the committee, it was decided to establish a rate of 17% because it is the "lowest modal rate" applied in the country. The concept of "modal rate" refers to the most frequent level of ICMS charged by the state in internal and interstate operations of a specific product or service.
Tax change
It has been determined that technical groups will meet to discuss the implementation of the aforementioned change. Finance Minister Fernando Haddad previously revealed that online stores Shein, Shopee e AliExpress are in process with the Brazilian government to adhere to the compliance plan. These companies agreed to pay the taxes in accordance with guidelines advocated by the government, in order to ensure fair competition with Brazilian stores.
The compliance plan is an initiative of the IRS, with the aim of covering e-commerce purchases of up to US$50. As part of this initiative, tax on products sold on international websites will be deducted during the purchase process. This compliance plan global e-commerce, in particular Chinese websites, follows the definition of a uniform ICMS rate by States, a crucial measure to ensure that buyers of products from international websites are informed in the future about the total prices of the items, including the collection of Import Tax , which is federal in scope, and ICMS.
How is it for the consumer?
The minister also mentioned that the plan, won by the Federal Revenue Service, is in its final stage of development. The minister explained that the discussion also involves the states, since they have the right to charge ICMS on the products purchased on these platforms. According to Haddad, the trend is that as soon as a consumer purchases a product, the e-commerce company will immediately authorize the government to reduce the amount already paid by the consumer by the amount that the company should withdraw. The minister pointed out that this model is the same adopted by the United States and Europe.
Earlier, the IRS announced its intention to eliminate the $50 exemption for orders between individuals. This was explored by some markets as a way to avoid paying taxes, although purchases made through websites were never exempt. However, due to popular pressure, the government backed down and opted to end this compliance plan with companies in order to ensure tax collection.
Ecommerce
Haddad had also stated that some companies have been abusing the interest on equity regime to avoid paying income taxes. Interest on equity is a way of distributing a company's profits to its shareholders who own shares on the stock exchange. At the moment, companies are exempt, but when proceeds from income are deposited in shareholders' accounts, there is a 15% tax levy.
