New Import Tax Regulations in Brazil: Cross-Border Shopping to Enjoy Tax Discounts

Financials Author: EqualOcean News Jul 09, 2024 07:13 PM (GMT+8)

EqualOcean reports that starting August 1, 2024, under Brazil's newly passed Law No. 914/2024, purchases over USD 50 on international cross-border shopping platforms that are part of the "Conforme Remessa" import tax compliance program will benefit from reduced import taxes.


This change is part of the Law No. 914/2024 approved in June. The law stipulates that purchases under USD 50 are subject to a 20% import tax and ICMS (Goods and Services Circulation Tax). According to the new regulations, these purchases will ultimately incur about 40% in taxes.

Since last August, purchases over USD 50 (including product price, shipping, and insurance, if applicable) on platforms participating in the "Remessa Conforme" program have been subject to a 60% import tax and 17% ICMS state tax. Due to cumulative taxation, consumers buying items over USD 50 have ended up paying approximately 90% in taxes.

EqualOcean reports that under the new regulations effective August 1, the import tax rate for purchases over USD 50 remains at 60%. However, a USD 20 tax discount is introduced. Under the new rules, a purchase valued at BRL 281(USD 51) will see import tax reduced from BRL 168.60 to BRL 58.60. Thus, before ICMS is applied, the total value of the taxed product is BRL 339.60. After adding ICMS, the final total import cost of the product is BRL 397.33, lowering the total tax rate to 41.39%. This overall tax rate is close to the total tax rate for products under USD 50 (40.4%).

However, consumers need to be aware that the new tax structure means the total tax amount increases with the purchase value. Items priced between USD 50 and USD 60 will incur about 45% in taxes, while those over USD 100 will be taxed around 60%. For international cross-border shopping platforms participating in the "Remessa Conforme" program, taxes will be collected along with the product price at the time of purchase. Marketplaces must also clearly inform buyers of the taxes they need to pay.