Originally published at the March 2 edition of World Tax Daily (Copyrights Tax Analysts – www.taxanalysts.com)
Brazil’s President Luiz Inácio Lula da Silva approved a law on February 27 that eliminates the 10 percent royalty tax (CIDE) for imported software, retroactive to January 1, 2006
Brazil’s President Luiz Inácio Lula da Silva approved a law on February 27 that eliminates the 10 percent royalty tax (CIDE) for imported software, retroactive to January 1, 2006.
The exemption, long awaited by the software industry, applies only to ready-to-use (off-the-shelf) software; it does not apply to any technology transfer software.
Law 11,452/07 originated from provisional measure 328, which did not originally provide for the exemption; it was inserted during the review and vote in the Senate and confirmed by the House of Representatives in early February.
Because of its retroactivity, taxpayers that paid CIDE on off-the-shelf software in 2006 may now claim CIDE refunds.
David Roberto R. Soares da Silva