The Federal Supreme Court (STF) has decided that the Tax on Circulation of Goods and Services (ICMS) should not be included in the calculation bases of the Contribution to the Social Integration Program (PIS) and the Social Security Financing Contribution (COFINS) - the so-called "Century Thesis".
However, many companies have been facing arguments from the Brazilian Federal Revenue Office (RFB) that the ICMS should also be excluded from the credits of the contributions calculated on the inputs acquired - there are infraction notices issued against some taxpayers.
With respect to this argument, the good news is that yesterday, through SEI Opinion No. 14483, the Attorney General Office of the National Treasury (PGFN) made it clear that, based on the STF decision, it is not possible to require the taxpayer to recalculate the PIS and COFINS credits by excluding the ICMS. According to the PGFN, "the issue was not, nor could have been, discussed in the case records" of the proceeding before the STF.
The Opinion in question binds RFB auditors, who are now unable to require the exclusion of the ICMS from the PIS and COFINS tax bases with respect to taxpayers' acquisitions of inputs.
BTLAW remains at the disposal of its Clients and other interested parties to advise them on this matter.
