The House of Representatives approved this week the text of Complementary Bill No. 108/2024, which regulates the Management Committee for the Tax on Goods and Services (IBS) and defines the rules for the tax administrative process. The bill also introduced significant changes to ITCMD and ITBI.

With the approval, some changes to the original text were made regarding ITBI, and considerations related to the incidence of ITCMD on the disproportionate distribution of dividends were maintained.

The concern of taxpayers that ITBI could apply to mere promises of sale of real estate was dismissed, and the concept of market value, which serves as the tax base, was refined.

Currently, ITBI is only levied at the time of the effective transfer of property, that is, upon registration with the competent real estate registry, which constitutes the taxable event and the obligation to pay the tax.

The definition of the exact moment of ITBI incidence has always been a point of controversy between municipalities and taxpayers. The tax reform seeks to bring clarity to the rules related to the timing of this tax collection.

Originally, the PLP provided that municipalities could demand ITBI upon the formalization of the respective acquisition title, such as the signing of the contract or the execution of the public deed of sale.

However, following this approval, changes were included, making it optional for the taxpayer to anticipate ITBI payment, so the tax will only be levied upon the formalization of the public deed at the real estate registry.

Thus, taxpayers will have the option, but not the obligation, to pay ITBI in advance when signing the purchase and sale contract of a property, instead of waiting for the actual transfer of ownership at the real estate registry.

Another relevant point provided in the PLP is the expansion of the concept of donation, foreseeing the incidence of ITCMD on the disproportionate distribution of dividends, a practice that is currently not taxed, and which, from the PLP, will allow inspections related to tax planning that uses this practice.

This provision refers to the concept of related persons, although it has not clarified whether this term applies only to individuals or also to legal entities.

The PLP text will be sent to the Senate for voting and may still undergo changes. The expectation is that the plenary will deliberate on the bill in November, after the municipal elections.

The Tax Planning Department of Marins Bertoldi Advogados is closely monitoring the developments on the subject and is fully available to clarify any doubts and delve deeper into each business reality.

By Gabriel Hoerner e Ana Caroline Ferreira