STF suspends law extending payroll tax exemption until 2027


In brief

On April 25, 2024, Minister Cristiano Zanin of the Brazilian Supreme Court (STF) granted a precautionary measure requested by the Attorney General’s Office (AGU) in the proceedings of ADI 7,633.

This measure suspends certain provisions of the law that extended the Contribution on Gross Revenue – “CPRB” for municipalities and 17 productive sectors until December 2027.

According to the minister’s assessment, the norm did not comply with the provisions of the Federal Constitution regarding federal budget and financial impact.

In late 2023, Congress approved Law 14,784/2023, which amended Law 12,546/2011 and extended payroll tax relief until December 2027 for the following 17 sectors: clothing and apparel; footwear; construction; call centers; communication; construction and infrastructure companies; leather; vehicle and body manufacturing; machinery and equipment; animal protein; textiles; information technology (IT); communication technology (CT); integrated circuit design; metro-rail passenger transport; collective road transport; and cargo road transport.

The aforementioned precautionary measure takes immediate effect, meaning that the affected companies are temporarily obligated to fully contribute to social security based on payroll from April 2024. The ancillary obligations  must be submitted by May 15, 2024, with payment due by May 20, 2024.

In the same decision granting the precautionary measure, Minister Cristiano Zanin ordered its consideration by the virtual plenary of the court.

This process began on April 26, 2024, and was scheduled to conclude on May 6, 2024. Ministers Flávio Dino, Gilmar Mendes, Barroso and Fachin have already presented their vote following Minister Cristiano Zanin´s position, resulting in a 5-0 score in favor of maintaining the precautionary measure. In view of that, Minister Luiz Fux requested additional time to review the case, as allowed by the STF’s Internal Rules. He has up to 90 business days to return the matter to the virtual plenary.


Considering that precautionary measure provided by Minister Zanin have immediate effects and there is no concrete expectation regarding when the trial will resume, as well as recognizing that the current situation undermines legal certainty among other constitutional principles, and that the Supreme Federal Court’s decision does not definitively address the merits, impacted companies need to evaluate legal alternatives to avoid payroll contribution collection and to maintain the option for CPRB until the legal deadline.

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