If approved by the President, the social contribution tax would increase by five percentage points for banks, insurance companies and other financial institutions beginning 1 July 2021.
The Brazilian Congress approved the conversion of Provisional Measure (PM) 1034/2021 into law, which would increase the social contribution on net profit (CSLL) by five percentage points for banks, insurance companies and other financial institutions from 1 July 2021 to 31 December 2021. The CSLL would return to the current rates as of 1 January 2022 and onwards.
If the Brazilian President approves the conversion of PM into law in the next few days, then the CSLL rates, beginning 1 July 2021, would be:
- 25% for banks
- 20% for insurance companies and other financial institutions
Brazilian entities may want to analyze their operations and assess the impact this rate change may have on their operations.
For additional information with respect to this Alert, please contact the following:
EY Assessoria Empresarial Ltda, São Paulo
- Ana Luiza Lourenco
- Fabio Martins
- Denis Gamba
- Nelita Donatti
- Diego Vargas
Ernst & Young LLP (United States), Latin American Business Center, New York
- Ana Mingramm
- Pablo Wejcman
- Jose Massari
- Tiago Aguiar
- Enrique Perez Grovas
Ernst & Young LLP (United Kingdom), Latin American Business Center, London
- Luciana Rodarte
- Claudia Orrico
Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific
- Raul Moreno, Tokyo
- Luis Coronado, Singapore
For a full listing of contacts and email addresses, please click on the Tax News Update: Global Edition (GTNU) version of this Alert.
