Brazil Clarifies Rules on Credits For PIS, Cofins Import Taxation

Brazil’s tax department has issued directives clarifying the use of tax credits for import taxes.
In Brazil, imports must be assessed the country’s PIS and Cofins social security taxes, which total 9.25 percent. This taxation was created in 2004 to eliminate what was seen as a tax advantage for importers who until then didn’t pay the PIS and Cofins taxes while Brazilian firms did.

In certain cases, however, companies have been allowed to claim these charges on their imports as credits for the payment of other taxes. This occurs when imported goods are used as inputs in the manufacture of ...