Prepare your company for the biggest transformation of the Brazilian tax system. The new rules are already underway and directly impact companies of all sizes.
This content explains the changes, how to prepare, and why acting now can make a difference for your business!
The Tax Reform approved by Constitutional Amendment No. 132/2023 marks the beginning of a historic transformation in the country's tax collection system. After decades of debate, Brazil is starting to replace one of the most complex tax systems in the world with a simpler, more transparent model aligned with international best practices.
This change directly impacts companies across all sectors, especially those involved in electronic tax management, such as issuers of NF-e, NFS-e, NFC-e, MDF-e, CT-e, and NFCom. The Tax Reform goes beyond changing taxes: it changes how taxes are calculated, reported, and collected, requiring technical, operational, and technological adaptations across various corporate processes.
In addition to replacing five consumption taxes (PIS, COFINS, ICMS, ISS, and IPI) with the creation of new ones — the Contribution on Goods and Services (CBS) and the Tax on Goods and Services (IBS) — the new model also introduces significant innovations such as destination-based taxation, the end of tax accumulation, the creation of the Selective Tax (IS), and a cashback mechanism for low-income families. It is a complex process that will demand significant operational, technological, and legal adjustments in different areas.
This scenario requires companies to have technical preparedness and strategic anticipation. Understanding the Tax Reform means more than just following rules — it’s an opportunity to reduce risks, avoid rework, adapt systems, and ensure competitive advantage.
The Tax Reform replaces five current consumption taxes with two main ones:
Furthermore, taxation will occur at the destination (where the good is consumed), and no longer at the origin (where it is produced). The model will also adopt full non-cumulativity, meaning it will be possible to credit all previously paid taxes, reducing the cascading effect and the final cost of products.
Understand the pillars that structure the Tax Reform and how they transform the way taxes are calculated, collected and managed in Brazil.
The Tax Reform brings structural changes that directly affect the issuance and management of electronic tax documents, requiring adjustments in issuing systems and ERPs.
New taxes and mandatory fields:
Complete review of technical layouts:
Update in issuance rules:
New CNPJ structure (alphanumeric):
Read the timeline for the application of the Tax Reform
Constitutional Amendment No. 132 was approved, enacting the Tax Reform and establishing:
Gradual elimination of PIS, COFINS, ICMS, and ISS;
Partial elimination of IPI, which will remain only for the Manaus Free Trade Zone;
Start of the practical testing period for the new national tax model, with reduced rates applied.
During this phase, the following rates will be adopted: CBS (Contribution on Goods and Services) at 0.9% and IBS (Tax on Goods and Services) at 0.1%.
Gradual replacement of ICMS and ISS by IBS. During this period, there will be a phased transition of tax rates.
2029: 10% IBS / 90% ICMS and ISS;
2030: 20% IBS / 80% ICMS and ISS;
2031: 30% IBS / 70% ICMS and ISS;
2032: 40% IBS / 60% ICMS and ISS.
Complementary Laws responsible for regulating the new Brazilian tax system will be approved, directly impacting companies' tax systems.
A highlight in this process is the approval of Complementary Bill No. 68/2024, which was converted into Complementary Law No. 214, marking a key step in the implementation of the Tax Reform;
Publication of the first versions of the Technical Notes.
From 2027, full CBS collection begins, with the following highlights:
Elimination of the federal taxes PIS and COFINS;
Zeroing of the IPI rate (except for products from the Manaus Free Trade Zone);
Creation of the Selective Tax, aimed at taxing goods and services harmful to health or the environment.
New system enters into full effect, with:
Definitive elimination of ICMS and ISS;
Exclusive application of CBS and IBS, consolidating the dual VAT model.
Every 5 years, there is the possibility of periodic review of tax benefits that reduce the taxation of specific sectors.
The new tax structure is based on constitutional principles that aim to make the system fairer, simpler, and aligned with the country’s realities.
The Tax Reform directly impacts ERP systems, electronic tax document issuers, and tax management platforms. Key points requiring technical updates:
We have prepared comprehensive and updated courses so you can master all the changes and stay ahead in tax management.
Check out our individual courses, with segmented content so you can focus on what you need most.
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