In 2021, it is likely that a lot of taxation precedents will be set by the Brazilian Supreme Court (STF), as it happened in 2020 (more than 50 relevant and resounding rulings were rendered by STF). In Brazil, taxation is a constitutional subject and these rulings are extremely relevant nationwide.
It is important for companies to act in advance for two main reasons: (1) to analyze and measure impacts of possible taxation changes in their businesses; (2) to file lawsuits to recover undue taxes paid because of the possibility of “modulation of effects” in decisions rendered by the Supreme Court (sometimes the decision of a tax being unconstitutional reaches only already existent lawsuits and future cases).
For instance, tech companies should pay attention to the judgments of the leading cases regarding taxation on software, that will be given in February/2021. Probably, all different kinds of software will be taxed under ISS and not ICMS (sort of VAT in Brazil), but the ruling will also have impact on federal taxes.
Exporters and importers, on the other hand, should prepare for the ruling on whether CIDE over international wire transfers/ remittances is constitutional or not. The judgment is scheduled for July/2021.
In such context, it is essential for each company to verify the possible direct and indirect impacts on taxation due to rulings that will be rendered by the Supreme Court – many of them are already scheduled for the first semester of 2021. Also, it is extremely important to consider filing lawsuits to make sure that the company will be benefited by favorable rulings.