In September 2015, the Brazilian Congress approved new rules regarding the tax on the circulation of goods, the famous ICMS. Constitutional Amendment 87/2015 caused some changes for online retail, in interstate sales made to non-taxpayers, bringing many doubts and dissatisfaction to the sector.
Responsible for handling no less than 70 billion reais a year, e-commerce attracts businessmen of all sizes who will be impacted by the ICMS Agreement of PEC 197/2012. Stay on top of the new rules and understand the main points of the new ICMS:
How was it before and how is it now?
Until the end of 2015, the supplier collected the ICMS at the source, that is, where the virtual commerce company is physically based. As of January 2016, the new taxation for the sale of goods became effective, where the taxation will be shared between the places of origin and destination, in percentage scales.
What percentages will be applied for ICMS sharing?
Consumers who are not ICMS taxpayers will be taxed at an interstate rate of 7% (for the North, Northeast, Midwest and Espírito Santo regions) and 12% (for the South and Southeast regions). There is also differentiation for internal state rates, which are shared between the state of origin and the state of destination of the goods. See below:
Year 2016: state of origin – 40%; destination state – 60%
Year 2017: state of origin – 60%; destination state – 40%
Year 2018: state of origin – 80%; destination state – 20%
From Year 2019: state of origin: 00%; destination state: 100%
For the consumer who is an ICMS taxpayer, he is the one who must pay the difference in the rate between the states of origin and destination.
What is the purpose of this change?
The new rules aim to make a fairer tax division between states. Since Rio de Janeiro and São Paulo are the states that buy almost 60% of the total goods, according to the new determinations, they are the ones that will bear most of the tax as well.
How will ICMS be collected?
ICMS must be collected through the National Tax Collection Guide - GNRE, or any other document with national validity that is in accordance with federal legislation in the unit of destination.
For each sale to a non-taxpayer, the entrepreneur must issue a bill with the calculation of the difference in the rate, sending it along with the invoice. There is also the possibility of registering state by state, still generating 27 different guides at the end of the month.
What impact can the new ICMS bring to e-commerces?
With the new division of ICMS, there is an increase in the final price of the product, which can reach up to 20% of the value. In addition to the fee designated by Congress, there are still operational costs to be added, due to the bureaucratization of the process.
The delivery of products is also affected, and may take up to 05 days longer than before the implementation of the new measure.
What is the entrepreneur's position regarding ICMS changes?
The new law has mainly made small e-commerces that opted for Simples unfeasible, in view of the company's operational increase and also the final value of the product. Ecommerce Brasil (a body operated by national companies) has already organized itself in a movement to repudiate the Amendment. Bureaucratic hurdles also present complications for small business growth.
New changes may revoke STF decision
Confaz (National Finance Policy Council) requested a review of the decision which exempts small companies from following the new ICMS collection. On January 17, Minister Toffoli confirmed the constitutionality of the change. Confaz argues that electronic commerce should share the ICMS between the states of origin and destination of the product.
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