Brazil ICMS on digital services 2018

Mon 23rd Oct 2017

The Brazilian state has confirmed the liability to ICMS for digital services from 1 April 2018. The consumption tax will only be applicable on sales to consumers – not B2B transactions. The place of taxation will be the resident state of the consumer.  The online marketplaces will be responsible for levying and collecting ICMS on domestic sales.  Where digital services are sold by non-resident providers to Brazilian consumers, ICMS will be levied by the credit or bank debt card operator.

ICMS Brazilian consumption tax

Imposto sobre Operações Relativas à Circulação de Mercadorias e Serviços de Transporte Interestadual e Intermunicipal e de Comunicações is the indirect tax which applies to the movement of goods, transportation, communication services and other general supplies of goods. The current tax level is between 7% and 25%.

Digital Services

Digital services includes: aps, e-books, software and streaming services for music, video or games.

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