Fischer y Cía. has created this website in order to support understanding and debate on these changes to the Chilean tax system. This is general information. Therefore, it is not necessarily complete or exact. It is also continually updated and corrected. We invite you to collaborate with this initiative by sending comments or documentation to


Tax reform in Brazil: On the way to a unified regime that provides greater legal certainty 

June 4, 2024

In November 2023, the Brazilian Senate approved a constitutional and tax reform, which objective is to simplify the actual tax regime in said country. The reform seeks to move from a complex and non-transparent system of municipal, state and federal taxes, towards a unified regime that promotes productivity and grants greater legal certainty to providers of goods and services. 

In this sense, the reform focuses on simplifying consumption taxation, replacing the multiple taxes currently applicable at the municipal, state and federal level (ICMS, ISS, IPI, PIS and COFINS), all of which have different rates and application mechanisms, for a new municipal and state tax (Tax on Goods and Services or IBS), of the same rate and payable to the same tax authority that will be created for these purposes and a federal tax (Contribution on Goods and Services or CBS). 

Both the IBS and the CBS adopt the VAT modality, generally allowing taxpayers to use the input tax when acquiring goods and services as a credit against the tax applicable on their sales of goods and services. 

Finally, the Selective Tax or IS is incorporated, a federal tax that functions as a fine tax on certain activities considered harmful to health and/or the environment (sale of vehicles, ships, tobacco, alcohol, extraction of mineral substances, among others). 

The reform contemplates a series of goods partially or totally exempt from CBS and IBS, a benefit that will focus on hygiene and food products. The discussion on this matter opens the debate on differentiating VAT rates according to products, as some experts in Chile have proposed. It should be considered that a proposal like this requires careful implementation, to solve the impact of the VAT that sellers of exempt goods must bear when purchasing their inputs, which they cannot subsequently download when making exempt sales. 

The new tax regime will begin to take effect progressively from 2026 until it becomes fully effective in 2033, where the tax burden for CBS and IBS will reach 27%. 

José Luis Campino