Michaela Merz

Brasil – IPI on resale of imported products

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651883_web_R_K_by_lichtkunst.73_pixelio.deAs a general rule, IPI, Brazilian equivalent of Excise Tax, is imposed on imports of goods. Importers of records similar to producers are required to collect IPI on resale of imported products.

This taxation of resale of imported products for IPI purposes became a controversial matter in Brazil, as many companies started to litigate, arguing that IPI should not be imposed on such resale Transactions.

In the past on number of these cases the court decisions were done in favour of Brazilian taxpayers. However in October 2015 the Brazilian Superior Court of Justice decided against the taxpayers in this case.

The above mentioned decision is a relevant precedents for many Brazilian taxpayers which have, based on favourable decisions issued in the past, decided not to impose IPI on resale of imported products.

Key impacts:

  • Taxpayers must evaluate whether they will collect IPI not paid upon resale of imported products carried out during the last five years;
  • Taxpayers’ margins may be impacted in case it is not possible to pass on to clients the IPI burden on the resale of imported products.
  • Tax authorities may now increase the level of inspection on importers of goods to be resold within Brazilian market, provided that jurisprudence is now against taxpayers;
  • Complexities associated with systems adaptations.

For more information please contact

Luis Reis
+55 11 3674 3862
luis.reis@br.pwc.com

 

Bildquelle: lichtkunst.73/pixelio.de

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