Brazilian Tax Reform: frequently asked questions
Here are the frequently asked questions about Brazil’s Tax Reform and its impacts on imports, exports, logistics and foreign trade services.
Understanding the Tax Reform
01. What is the Tax Reform?
The Consumption Tax Reform was created by Constitutional Amendment No. 132/2023 and regulated, among other rules, by Complementary Law No. 214/2025.
The new model mainly creates three taxes:
- CBS – Contribution on Goods and Services;
- IBS – Tax on Goods and Services;
- IS – Selective Tax.
Throughout the transition period, current taxes such as PIS, COFINS, ICMS and ISS will be gradually replaced by the new model.
02. When does the Tax Reform take effect?
Implementation is gradual (from 2027 to 2033).
2026 is an important period of adaptation and testing, while the following stages of the transition will take place in subsequent years.
The main taxes will be replaced progressively until the new model is fully implemented, as scheduled for 2033.
03. Which taxes will be replaced?
In simple terms:
- PIS and COFINS will be replaced by CBS;
- ICMS and ISS will be gradually replaced by IBS.
Import Duty is not part of this replacement and will remain in place. IPI, in turn, will have its rates reduced to zero from 2027 as a general rule, except for products manufactured in the Manaus Free Trade Zone (ZFM), which will keep the current rates in accordance with the applicable criteria.
04. What is IBS?
IBS is the Tax on Goods and Services, under the jurisdiction of the States, the Federal District and the Municipalities.
It will gradually replace ICMS and ISS within the new tax model.
05. What is CBS?
CBS is the Contribution on Goods and Services, under federal jurisdiction.
It will replace PIS and COFINS.
06. What is the Selective Tax?
The Selective Tax applies to certain products considered harmful to health or the environment, as defined by law.
It may also apply to certain import operations.
Impacts on imports
01. Does the Tax Reform change import taxes?
Yes, but it is important to distinguish between the taxes.
Import Duty (II) will not be replaced by the Tax Reform.
On the other hand, imports will become subject to the IBS-Import and CBS-Import rules, in addition to the other taxes applicable to the operation.
During the transition, the current model and the new system will coexist.
In the case of IPI, special attention is needed: the general rule will be the reduction of rates to zero in 2027, but products manufactured in the Manaus Free Trade Zone (ZFM) will remain subject to the current rates, according to the criteria defined for this exception.
02. Will I still pay ICMS on imports?
During the transition period, yes.
ICMS will be gradually replaced by IBS.
Therefore, for a few years, importers will have to deal with both models at the same time.
03. Will PIS and COFINS cease to exist?
Yes, according to the Reform schedule, they will cease to exist from 2027.
They will be replaced by CBS.
For importers, this means changes in how operations are calculated and treated for tax purposes.
04. When will the change start affecting imports?
Implementation is gradual.
2026 is an important period of preparation and adaptation, while the following stages progressively introduce the new tax system.
That is why companies should start reviewing their processes before the taxes are fully replaced.
Impacts on exports
01. Does the Tax Reform change the taxation of exports?
The Reform maintains the tax relief on exports within the rules set by law.
The goal is to prevent consumption taxes from being built into the cost of goods destined for foreign markets.
02. Will exporters be able to keep credits?
Yes, within the rules established for the new tax model.
The treatment of credits will be an important point for exporters during the transition.
03. Can the Reform increase export costs?
The impact must be analyzed considering the entire chain of the operation.
Even with the tax relief on exports maintained, services, logistics costs and other components of the operation may undergo tax changes.
Therefore, the total cost of the operation should continue to be monitored.
Impacts on logistics and services
01. Will foreign trade services also be affected?
Yes.
The Tax Reform also affects the taxation of services.
This may involve services such as:
- customs clearance;
- consulting;
- logistics;
- transportation;
- warehousing;
- technology;
- administrative services;
- among others.
02. Can the prices of services hired from foreign trade companies change?
It is possible.
Changes in the taxation of services may affect pricing, depending on each company’s tax structure and the treatment of credits.
Therefore, service contracts and prices should be reviewed during the transition period.
03. Does the Tax Reform change the logistics cost of imports?
It may.
Freight, warehousing, transportation and other services related to the logistics chain may be affected by the new tax system.
Importers should consider not only the taxes levied on the goods, but also the tax effects on the services involved in the operation.
04. Will customs clearance be affected?
Yes, mainly due to changes in the information and tax treatments related to DUIMP.