Tax | Key Points to Consider When Importing Services From Brazil

Most Brazilian taxes are exempt when services are exported from Brazil, which can make them real competitive worldwide. Some observations are important, though: 

1. Place where the service result occurs. The tax on services (ISS) is, in general, exempt when a service is exported from Brazil. But if the results of the services occur in Brazil or if it is difficult to define where exactly it occurs, the tax can be due. Its rates vary from 2 to 5%. 

2. The tax on services is a Municipal tax. So, the rules that define where it occurs are set by each municipality laws and can vary widely nationwise. 

3. Some taxes does not have this discussion. That is the case of the Contribution on importation of services (PIS/COFINS), Contribution of intervention on economic domain (CIDE) and Tax on financing operations (IOF). All of them are exempt. 

4. Some taxes are still applied. The corporate tax (IRPJ) and the Social Contribution on Profits (CSLL) are still due, and them can have rates up to 40% That is because some activities, as financial institutions have a higher CSLL. 

Undertanding the tax burden when exporting service from Brazil is key for negotiating the proper price for the service.


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