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Rio de Janeiro State enacted a new Amnesty Program for the payment (“PEP”) of tax debts in installments

23/02/2021
New Special Payment Program (“PEP”), as governed by Decree
# 47.488, of February 12, 2021

 
On February 17, 2021, the State of Rio de Janeiro Governor enacted Decree # 47,488/21, launching a new Amnestry Program, the Special Payment Program (“PEP”), for the payment of tax debts related to the State VAT tax (“ICMS”), State Donations and Real Estate Transfer Tax (“ITCMD”) and Automotive Property Tax (“IPVA”) in installments. The PEP grants reductions on interest, punitive and late payment fines to Rio de Janeiro State taxpayers who settle tax debts concerning to tax triggering events occurring up to August 31, 2020, whether enrolled or not in the tax attorney’s debt list. The PEP follows the definitions of the Agreement No. 87/2020, approved in September, 2020 by the National Finance Policy Council (Confaz).

 Payment Conditions

Tax debts enroled with the Program may be paid:In a single installment, with a reduction of up to 90% of the punitive and late payment fines, interest and monetary adjustments;Between 2 and 5 consecutive monthly installments, with a reduction of up to 80% of the punitive and late payment fines, interest and monetary adjustments;Between 6 and 11 consecutive monthly installments, with a reduction of up to 70% of the punitive and late payment fines, interest and monetary adjustments;Between 12 and 23 consecutive monthly installments, with a reduction of up to 60% of the punitive and late payment fines, interest and monetary adjustments;Between 24 and 35 consecutive monthly installments, with a reduction of up to 50% of the punitive and late payment fines, interest and monetary adjustments;Between 36 and 47 consecutive monthly installments, with a reduction of up to 40% of the punitive and late payment fines, interest and monetary adjustments; andBetween 48 and 60 consecutive monthly installments, with a reduction of up to 30% of the punitive and late payment fines, interest and monetary adjustments. Others Details

The taxpayer enrolling with the PEP must indicate the debts to be included within the Program and his/her payment conditions. Upon inclusion of the debt, the taxpayer waives from any appeals or defenses filed with respect to it at administrative or judicial level, as well as from its election to any previous installment plans.

The PEP also benefits tax debts already included within previous amnesty programs, which may migrate to this new amnesty program. Neverthless, the PEP is not available for tax debts which were judicially deposited. With respect to debts secured by other types of guarantees, such guarantees shall be only released upon the debt full settlement. The minimum amount of the installments will be equivalent to 450 Ufirs (R$ 1,667.38 in current values).

According to Suplementary Law #189/2020, the reductions shall only be effective with the payment of the first or single installment, and will be suspended if more than two installments become overdue at the same time, consecutively or not, or if any of the installments remains unpaid for a period of over 90 days.

Furthermore, the taxpayer’s (through any of its establishments) failure to pay outstanding taxes, with triggering events occurred after the execution of the installment plan, for a period longer than 60 days, will trigger the Program’s cancellation. Before cancelling the taxpayers’ enrollment, the State of Rio de Janeiro must notify the taxpayer to pay the debt or cure any breach within 48 hours.

Taxpayers must enroll with the PEP until April 29, 2021 and the State Department of Finance, the Staff Secretary of the State and the Rio de Janeiro State’ Attorney will enact its regulation, clarifying/detailing the procedures to enroll with the Program.
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