Brazil: Federal Decree changes the Financial Transactions Tax Regulations (Decree 6306/2007)


Last Friday, 07/29/2022, Decree No. 11,153/2022 was published, promoting changes in Decree No. 6,306/2007, the Financial Transactions Tax Regulations (“RIOF”).

Items VII to IX in article 15-B of the RIOF, which establish a 6.38% tax rate in exchange transactions related to credit card operations, were altered. The new wording of the items no longer refers only to “credit or debit card administrators or commercial or multiple banks in the quality of credit card issuers”, expanding the tax triggering events for transactions with “institutions that participate in cross-border payment arrangements”.

It was also included items XXII and XXIII to article 15-B. The first item provides for an increased tax rate of 6.38% for certain exchange transactions relating to the transfer abroad of resources in national currency by the institutions that participate in cross-border payment arrangements. The second item provides for a zero tax rate for these same transactions when carried out by the Federal Government, the States, the Municipalities, the Federal District, and their foundations and autarchies.

Finally, it was contemplated that these changes and new items will be part of the gradual reduction of the IOF-Exchange rates over the next few years, which should be zero as of January 2029.

The Decree went into effect on its date of publication, i.e. on July 29, 2022, and applies to all settlements carried out as of this period.

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