Brazil: Increased tax rates on capital gains effective from January 1 2017

International Tax Review is part of Legal Benchmarking Limited, 4 Bouverie Street, London, EC4Y 8AX

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Brazil: Increased tax rates on capital gains effective from January 1 2017

pereira.jpg
conomy.jpg

Alvaro Pereira

Mark Conomy

On April 29 2016, the Interpretative Declaratory Act 3/2016 (ADI 3/2016) was published, providing for the Brazilian Federal Revenue Authorities' (RFB) position that the increased progressive tax rates in relation to capital gains derived by individuals (and non-residents) should only apply from January 1 2017.

By way of background, Law 13,259/2016 was recently introduced providing that capital gains earned by individuals (and non-residents) arising on the alienation of Brazilian assets and rights of whatever nature are subject to progressive rates varying from 15% to 22.5% (depending on the amount of the gain).

Law 13,259/2016 provided that the law entered into effect from the date of publication producing effects from January 1 2016. This created some uncertainty in Brazil around the constitutionality of the particular amendments that result in an increase in tax due. ADI 3/2016 provides that the articles of Law 13,259/2016 dealing with the increase in capital gains tax rates should only be applicable from January 1 2017.

ADI 3/2016 is a welcome development, providing clarity for taxpayers in relation to the capital gains tax rates that should be applied to transactions undertaken in 2016.

Alvaro Pereira (alvaro.pereira@br.pwc.com) and Mark Conomy (conomy.mark@br.pwc.com)

PwC

Website: www.pwc.com.br

more across site & shared bottom lb ros

More from across our site

Singapore extends GST remission in 2025 budget; UK closes in on e-invoicing; two new partners at RSM Belgium ;and more
As we build up to another busy year for the World Tax rankings and ITR Awards, we give a rundown of some of the major firms and trends within the Brazil tax market
Dario Acconci of Hawksford argues that Singapore’s 2025 Budget, which features a hefty corporate income tax rebate, is ‘generous and forward-looking’
The mass firings could affect taxpayer guidance and are expected to reduce the agency’s ability to conduct audits, one expert tells ITR
The law firm, which will operate as an independently managed subsidiary of KPMG, has received court approval with conditions
Krause will take the reins until President Trump’s pick Billy Long assumes the role; in other news, CohnReznick became the latest tax firm to receive private equity backing
Flexibility and transparency on fees ranked favourably against international counterparts, according to new ITR+ research
Gilles Roth, speaking at the Luxembourg Transfer Pricing Association’s launch event, also said that his country is ‘carefully considering’ the implementation of amount B
The ruling in January was the first time the court had unanimously upheld a taxpayer's position in a case concerning TP, according to a lawyer who worked on the case
The UK R&D consultancy’s CEO tells ITR about Aussie cricket inspirations, supporting vital cancer research and what makes tax cool
Gift this article