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January 19, 2023

Brazil announces tax recovery measures

  • This Alert summarizes the measures related to PIS/COFINS, voluntary disclosure, and Federal administrative procedures.

On 12 January 2023, the Brazilian Government announced new tax recovery measures that may potentially significantly impact taxpayers.

The following is a summary of the key measures:




ICMS included in the PIS/COFINS credits basis

(on inputs purchases)

Allowed on the amounts of purchases

Not allowed (new rules will be in force on 1 May 2023)

Voluntary disclosure

(payment of debts without penalties)

Not allowed if an audit was initiated

Allowed even in the case of ongoing audits to the extent the audit was initiated by 13 January 2023. Debts must be paid by 30 April 2023

Federal Administrative Procedure


Casting vote

Law 13,988/2020 ruled that tied discussions should be resolved in favor of taxpayers

Tied discussions will be resolved by the casting vote, in charge of a representative of Tax Authorities

Appeal to the administrative Court

(composed by representatives of both tax authorities and taxpayers)

Except for a few cases, discussions could be addressed to the administrative Court analysis (as opposed of being analyzed solely by tax authorities)

Only discussions involving amounts higher than 1,000 minimum salaries (approx. R$1,300 million) will be analyzed by the administrative Court

Tax settlement

Settlement of tax debts is a new process in Brazil and the legislation is being improved over the years, specially post COVID-19 pandemic. The settlement of tax debts is possible to the extent certain conditions are met.

Different levels of discounts were granted to foster the settlement, to the extent certain requirements are met. Adherence to the settlement must be made by 31 March 2023


For additional information with respect to this Alert, please contact the following:

EY Assessoria Empresarial Ltda, São Paulo

Ernst & Young LLP (United States), Latin American Business Center, New York

Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific