President Jair Bolsonaro sanctioned without veto the Complementary Law that alters the collection of the Service Tax (ISS) by Brazilian municipalities, according to this Thursday (24) edition of the Official Gazette (DOU).
The new law provides for a transition to the sharing of the proceeds from the collection of the tax, from the municipality of the location of the service provider to the domicile of the service borrower. That is, transfers the tax collection authority to the municipality where the service is provided to the end user.
Today, it is carried out by the city where the supplier’s headquarters is located. THE amendment enters into force in 2021 foresees a transition until 2023, with the progressive reduction of the percentage of resources destined to cities where are the companies that provide the service and the progressive increase of the percentages destined to the locations where the consumers are.
The new law favors inland cities. According to the text approved by the Senate at the end of August, the services that will have the collection transferred to the destination are those of health plans and veterinarians; administration of funds, consortia, credit and debit cards, customer portfolios and post-dated checks; and leasing.
The need to approve the project that regulates the ISS payment arises from changes made by Complementary Law 157, of 2016. Until then, the ISS was with the municipality of origin – where the supplier of the good or service is located.
- Front of mayors says they support tax reform with separate ISS and rates of 2% to 5%