CONFAZ requests ME to extend the start date of new NCMs

CONFAZ (National Council for Financial Policy) sent a letter to the Ministry of Economy requesting that the effective date of the GECEX Resolution No. 272/2021, which changed the NCMs (Common Mercosur Nomenclature), to August 1, 2022. information was released by ABSOLAR (Brazilian Photovoltaic Solar Energy Association).

The date determined for these changes to come into effect is April 1, 2022, as per reported by Canal Solar at the beginning of this year.

“The request was made by Confaz in line with our efforts, recognizing the uncertainty in being able to approve the update of ICMS agreements by April 1st. The extension of this effective date to August 1st will give us more time to move forward with CONFAZ to update the sector's ICMS agreements before there is undue tax risk in this period”, stated Rodrigo Sauaia, president of ABSOLAR.

According to CONFAZ, the motivation for the request came from demands that have been presented to the Council by companies and entities in the photovoltaic sector, in addition to the concern that companies operating in the solar sector will be negatively impacted.

“This change provoked a demand from companies in the photovoltaic sector with the National Council for Financial Policy regarding the need to update the discriminations and NCM/SH codes present in the ICMS Agreement No. 101/97, under the argument that the maintenance of the old nomenclatures could impact the exemptions from the Tax on Operations Relating to the Circulation of Goods and on Provisions of Interstate and Intermunicipal Transport and Communication Services – ICMS – already incorporated into the commercial and tax mechanisms of the entire photovoltaic chain”, informs the letter.

“Thus, considering the demands that have been presented to CONFAZ by companies and entities in the photovoltaic sector; considering the proximity of the beginning of the production of effects of GECEX Resolution nº 272/2021; considering that companies in the sector may have their businesses negatively impacted, and considering that the federated units will still require at least one more cycle of meetings to present a proposal that can put an end to the insecurity of companies, we endorse the request to change the beginning of the production of effects of GECEX Resolution nº 272/2021 for August 1st, 2022, considering that the next ordinary meeting of CONFAZ is scheduled for July 1st, 2022”, concluded the document.