Supreme Court and House of Representatives discuss Inheritance Tax (ITCMD) on Free Benefit Generating Plan (PGBL) and Free Benefit Generating Life Insurance Plan (VGBL) with opposing theses
The Federal Supreme Court (STF) is discussing—in a case with general repercussions, whose judgment was paused last Monday (August 26)—an issue affecting the validity of a rule included in the tax reform regulations currently being processed by the House of Representatives: the collection of the Tax on Inheritance (ITCMD) on transfers made to beneficiaries upon the death of the holder of private pension plans under the Free Benefit Generating Plan (PGBL) and Free Benefit Generating Life Insurance Plan (VGBL).
Changes to inheritance tax may impact owners of family businesses—here’s what you need to know
Limited liability companies—commonly known as LTDA in Brazil—that distribute profits disproportionately among members may need to restructure internally due to proposed changes to the inheritance tax currently under discussion by Congress as part of the Tax Reform regulation.
Tax reform: Could inheritance tax on pension plans change?
After the House of Representatives approved the tax reform proposal, the working group drafting the second regulatory text moved to reinstate the inheritance tax on private pension plans like the Free Benefit Generating Plan (PGBL) and Free Benefit Generating Life Insurance Plan (VGBL).
Tax on Goods and Services (IBS), place of business, and telecommunication transactions
As part of the regulatory framework for Amendment to the Brazilian Constitution 132/2023—which established a modern and simplified indirect taxation system—the Federal Government submitted Supplementary Law Bill (PLP) 68/2024. The bill creates the Tax on Goods and Services (IBS), the Social Contribution on Goods and Services (CBS), and the Brazilian Excise Tax (IS), while also addressing other aspects of the tax reform.
The reform’s structure remains intact, but the cap raises doubts
The core aspects of the consumption tax changes remained intact in the tax reform regulation bill passed this week in the House of Representatives. However, experts have doubts about the cap set for the reference VAT rate.
The legal subordination of executive employees and the taxation of profit-sharing (PLR)
The Superior Court of Justice (STJ) recently issued a decision in the judgment of the appeal REsp 1.948.478 that a company could not deduct amounts paid to officers as Profit Sharing (PLR) and bonuses from the Corporate Income Tax (IRPJ) and Social Contribution on Profits (CSLL) tax base.
Court authorizes sale of BRL 14.5 million in State Tax on Goods and Services (ICMS) credits
A soybean exporter secured authorization from a São Paulo court to transfer BRL 14.5 million in State Tax on Goods and Services (ICMS) credits without being subject to the limits of the state government’s ProAtivo program, which would have restricted the sale to BRL 1.2 million to third parties.
Deduction of the Social Integration Program Contribution (PIS) and the Social Security Financing Contribution (COFINS) may take up to 5 years under the tax balance Provisional Presidential Decree (MP)
Large exporting companies, mainly in the soybean, animal protein, mining, and fuel distribution sectors, holding Social Integration Program Contribution (PIS) and Social Security Financing Contribution (COFINS) credits to be offset, may take up to 5 years to deduct all credits under Provisional Presidential Decree (MP) No. 1,227 governing tax balance. Different sectors are challenging the MP, calling it a decade-long setback.
