Brazil’s 2027 Tax Reform: Aligning with Global Standards and Introducing Split Payment Model

• Brazil is introducing a new tax collection model to align with international standards and support fiscal sustainability.
• The new system will be implemented in 2027, with major changes including the split payment model.
• The split payment model separates taxes automatically during financial transactions, reducing tax default risk and improving transaction predictability.
• This model simplifies the tax environment, reducing the time and resources needed for tax calculations and payments.
• The system will apply to electronic payments, emphasizing digitalization and tax efficiency.
• New legislation includes mechanisms to prevent double taxation and allow automatic compensations.
• A new method for tax credits will integrate credit assessment into tax systems for instant validation.
• The reform aims to make Brazil more competitive, transparent, and less bureaucratic, attracting foreign companies.

Source: global.ecovis.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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