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An overview by Demarest, Taxand Brazil
The Brazilian government has recently published its first Supplementary Law No. 214/2025, establishing general rules for the Subnational Tax on Goods and Services (IBS), the Federal Contribution on Goods and Services (CBS), and the Federal Excise Tax (IS), while creating the IBS Management Committee. The President vetoed several provisions, including exemptions for investment funds/endowments, non-incidence of IS on exports, and specific rules for the Manaus Free Zone.
Brazil’s Constitution requires vetoes to be reviewed within 30 days by Congress. Next steps will include publishing regulations, setting a reference rate, and passing a second supplementary bill (PLP 108/2024) to address the IBS transition, resource allocation, and administrative litigation.
Tax experts from our Brazilian member firm Demarest have published a more detailed overview of this law which can be read here.
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