Brazil's Tax Reform: the transition is long, the decisions are now

Between 2026 and 2033, Brazil replaces PIS, Cofins, IPI, ICMS and ISS with the CBS, the IBS and the Selective Tax. An eight-year calendar invites companies to postpone decisions, and that is a misreading: much of what a company signs now (supply contracts, price lists, leases, systems investments) will already take effect under the new regime.

The calendar is not the deadline

Constitutional Amendment 132/2023 set the structure of the reform and Complementary Law 214/2025 regulated most of the rules. In 2026, the CBS (0.9%) and the IBS (0.1%) start with test rates. In 2027, the CBS applies in full and PIS and Cofins cease to exist. From 2029 to 2032, ICMS and ISS fall year by year while the IBS rises. In 2033, the new model applies in full.

Read that way, there seems to be time. But the calendar shows when each tax changes, not when each decision has to be made. A five-year contract signed today ends in the middle of the transition. A pricing policy reviewed only in 2027 arrives late to the first relevant change.

The calendar shows when each tax changes, not when each decision has to be made.
MOXS Empresarial

The logic changes, not just the rate

Three changes in logic weigh more than the final rate each sector will pay:

Broad credit: non-cumulativeness now reaches, as a rule, what is acquired for the business, which changes the value of each supplier in the chain.
Taxation at destination: the tax belongs to the place of consumption, not of origin, which reduces the weight of regional tax incentives in choosing where to operate.
Collection at financial settlement: the split payment set out in LC 214/2025 brings tax payment closer to the moment money moves, with a direct effect on cash.

A concrete staircase rising from shadow toward an opening of light. — The transition runs until 2033; the decisions that cross it start earlier.

Contracts and prices: where risk builds up

Long-term contracts usually set prices with taxes built in and no clause for a change of this scale. When the tax burden and credits shift, one party gains and the other loses, and renegotiation happens under pressure. Reviewing rebalancing, tax pass-through and term clauses now costs less than disputing them later.

The same logic applies to prices. Under broad credit, what matters to a business customer is the price net of the credit it can take. Companies that sell to other companies need to know, before their competitors do, how their position changes in that calculation.

A minimum agenda for the coming months

There is no need to solve everything at once. There is a need to know what cannot wait. A minimum agenda starts on three fronts: an impact map by type of operation, the list of contracts that run past 2027, and an assessment of the tax and finance systems that will run both regimes in parallel.

The starting point is the business, not the tax. The right question is not how much the company will pay in 2033, but which decisions made this year become more expensive if they ignore the transition.

Practical conclusion

01Contracts, prices and investments signed now already take effect under the new regime.
02Broad credit, taxation at destination and split payment change the business logic, not just the rate.
03Start with the impact map, the contracts that run past 2027 and your systems.

MOXS Empresarial

Editorial team

Sources

1.Constitutional Amendment No. 132/2023 (consumption Tax Reform).
2.Complementary Law No. 214/2025 (establishes the IBS, the CBS and the Selective Tax).