The regulation of the transfer of ICMS credits in operations between establishments

On December 5, the Chamber of Deputies approved Complementary Bill No. 116/23 in response to the decision of the Supreme Federal Court, which mandated the need for specific legislation regarding the exemption from ICMS (Tax on Circulation of Goods and Services) payment in the transfer of products between establishments belonging to the same company. This bill will now proceed to presidential sanction.

While the matter had already been adjudicated in 2017, it was only this year, following a review of appeals, that the Supreme Court determined that rules pertaining to the utilization of ICMS credits needed to be regulated by the end of the year, or they would be fully enforced by taxpayers starting in 2024.

Due to the lack of consensus in the National Council of Fiscal Policy (Confaz), composed of state finance secretaries, the Senate was tasked with addressing the issue through the Complementary Bill.

The text proposes amendments to Complementary Law No. 87/96, stipulating that, in addition to the non-incidence of the tax on the transfer of goods to another warehouse of the same taxpayer, the company will have the right to take advantage of the credit related to previous operations, even in cases of interstate transfer to an establishment of the same legal entity.

In these cases, the credit will be guaranteed by the destination state of the transferred goods through a credit transfer, limited to the interstate rates applied to the value attributed to the transfer operation.

If there is a positive difference between the previously accumulated credits and the interstate rate, this difference will be ensured by the federative unit of origin of the transferred goods.

It is important to note that the wording of Complementary Bill No. 116/23, regarding ICMS credits registered on inputs and previous operations, differs from the wording given by Convênio Confaz 174/2023, which stipulated the "mandatory" transfer of ICMS credit to the destination establishment.

Moreover, the text broadly allows taxpayers to equate transfers between establishments to those where the tax trigger occurs.

Thus, such taxpayers can take advantage of the credit calculated according to the state rates in internal operations or under the interstate rates in transfers between different states.

We will continue to monitor the evolution of this matter and make ourselves available to address any questions that may arise.