Brazil Issues New Regulations on Social Contributions

Brazil recently issued new regulations (Normative Instruction 1911/2019) on the calculation and collection of the so-called PIS/Pasep and COFINS social contributions.

Per Law 10865 of 30 April 2004, as amended, the entry of foreign goods into the Brazilian territory is subject to a PIS/Pasep-import contribution of 2.1 percent as well as a COFINS-import contribution of 9.65 percent assessed on the basis of the customs value, resulting in a combined assessment rate of 11.75 percent. The payment, credit, delivery, employment or remittance of money to residents or residents abroad for services rendered is levied at rate of 1.65 percent (PIS/Pasep-import) and 7.6 percent (COFINS-import). A number of products are subject to different rates, however.

Normative Instruction 1911/2019 sets forth provisions on such matters as taxable events and entities, non-applicability, exemptions and suspensions, basis for calculation, assessment rates and withholding of contributions.