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We are posting about “Brazil: ICMS – SUBSTITUIÇÃO TRIBUTÁRIA” in this time.
Tributary Substitution is the rules adopted by the government, provided for in the Federal Constitution of 1988, article 150th, § 7, where, basically, a taxpayer will “collect” the ICMS on behalf of another taxpayer. Named thus, as, SUBSTITUTE and SUBSTITUTED. The SUBSTITUTE: which will “collect” the ICMS in place of SUBSTITUTES. Collecting in advance, that is, before the generating event occurs. There is the possibility of immediate and preferential restitution of the amount paid, if the presumed fact does not occur. Basically, the law elects a taxpayer to perform the tax obligation rather than an appropriate taxpayer.
Let us understand better, according to the law, it is possible to understand that the regime has the purpose of collecting taxes due on operations after this initial operation, that is, before the generating event, in this case, before the real circulation of merchandise.
To know if your product is destined to carry out this regime of Tributary Substitution, you must be aware of the Agreements, Protocols and States Legislation, because is through these pronouncements that are determined whether these products fit or not.
Practicing, when selling a merchandise that is subject to the Tributary Substitution rules, which will be carried out via industry to the distributor, the industry must withhold and collect the ICMS, which in fact will obtain its generating fact in the operations subsequent to this, in a few words, to withhold the ICMS from the sale of the distributor to the retailer, from the retailer to the final consumer.
Do all companies have this obligation? Your company is eligible for this type of rules only if it is a taxpayer of the ICMS, that is, any person, whether physical or legal, who carries out, on a regular basis and with a commercial volume, the circulation of goods, interstate and intercity transportation services and communication, even if these have their beginning outside the country.
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