Bolsonaro sanctions bill that changes fuel ICMS

President Jair Bolsonaro (PL) fully sanctioned the Complementary Law Project (PLP) No. . The single ICMS will also apply to natural gas and jet fuel. The sanction was published in an extra edition of the Official Gazette.

Currently, the tax rate is a percentage charged on top of the final price of the liter at the pump, which undergoes variations in the dollar and in the international price, further burdening the final amount charged to consumers.

The sanctioned project determines that ICMS is charged on the price at the refinery or at the import counter, when the fuel comes from abroad. The new values, by the proposal, will be defined through the National Council of Finance Policy (Confaz), which brings together representatives of the economic area of ​​all states and the Federal District.

Diesel is the only fuel that would adopt an emergency transition rule. According to this system, while the single charge –and corresponding unification of the rate– of diesel is not adopted, the reference value for stipulating the tax will be the moving average of the average prices charged to the final consumer in the 60 months prior to its establishment.

In defining the new rates, a minimum interval of 12 months must be provided between the first setting and the first readjustment of these rates and of six months for subsequent readjustments, with a period of 90 days being observed in the case of a new increase.

The measure also reduces the rates of Contribution to PIS/Pasep and Cofins and Contribution to PIS/Pasep-Import and Cofins-Import to zero, guaranteeing the maintenance of credits linked to legal entities in the production chain.

The new law simplifies the levy of ICMS on fuels and lubricants, grants greater uniformity and dilute the weight of the tax burden on these products to face the increase in oil resulting from the war in Ukraine.