VAT Registration in Brazil
Our agents specializing in company formation in Brazil assist investors who are interested in VAT registration in Brazil.
VAT registration in Brazil in 2026 is mandatory for all businesses that supply goods or services that are subject to VAT/GST and other indirect taxes (IPI, ICMS, ISS, PIS, COFINS and, in the 2026 test phase, the new CBS and IBS). Our Brazilian company formation experts can assist with VAT registration and compliance.
| Quick facts | |
|---|---|
| Brazilian VAT system | Brazil is moving to a dual VAT (federal CBS + state/municipal IBS, EC 132/2023 and LC 214/2025): test rates of 0.9% CBS and 0.1% IBS in 2026, CBS in full from 2027 replacing PIS/COFINS, and ICMS/ISS phased out by 2033; until then it has a complex taxation system with direct and indirect taxes at municipal, state, and federal levels; Our company formation specialists can detail the tax system for you. |
VAT on Sales and Services (ICMS) – characteristics | A state tax on selling or importing goods, electricity, transportation, and communications. |
ICMS rates (similar to VAT) | From 4% to 25%, but some products might have lower or higher rates, depending on the specific region in Brazil. |
| Excise Tax (IPI) – characteristics | A federal tax on manufactured goods and imports, with rates based on the product type. |
| Municipal Service Tax (ISS) – characteristics | A local tax in Brazil applied to certain services, with rates ranging from 2% to 5%. |
| Federal Social Contributions (PIS-PASEP & COFINS) | Social contributions based on the company’s turnover, with rates varying on the company’s activities. |
| VAT registration procedure | Businesses must register with federal and state tax authorities; If offering services, municipal registration is required. Our company incorporation agents can help with the procedure. |
| Documents required for registration | – Articles of Association, – business address, – official business license, – taxable person ID, etc. |
| Cadastro Nacional de Pessoa Juridica (CNPJ) | A unique identification number assigned to legal entities (similar to the Tax Identification Number), obtained at company registration, before the state and municipal tax registrations. |
| Filing and payment | Monthly |
| Record keeping | 5 years |
| Penalties | If tax returns are not filed or filed late, companies must pay penalties from 1% to 100% of the due taxes. |
| Timeframe for registration | 1-2 months (approx.) |
| Other taxes in Brazil | – corporate income tax, – payroll tax, – withholding taxes, – social security contributions, etc. |
| Assistance | Our team can help you open a company in Brazil and guide you through the process of VAT registration and other tax matters. |
What are the VAT registration requirements in Brazil for a foreign company?
Foreign companies that have opened a permanent business establishment in Brazil are subject to the same requirements to register for VAT as a local company. This means that they will have to register when their company supplies goods or services that are subject to the entirety of the taxes that make up the VAT/GST obligations in the country.
In addition to the need for registration, the foreign company will also be required to appoint a fiscal representative, but only when it has opened a permanent establishment.
What are the VAT registration requirements for a Brazilian company?
As previously mentioned, any company that offers goods or services that are subject to value-added tax and other indirect taxes will need to register.
Companies are required to register separately for some of the indirect taxes. The requirements apply both in the case of local companies and in the case of foreign corporations with a permanent establishment in Brazil. For example, ICMS registration is separate in each state where the company has a permanent establishment. Businesses register for the ISS tax in the city in which they have a permanent establishment.
What is the VAT number in Brazil?
The VAT number in Brazil serves as the company’s tax identification. This is issued by the National Register of Corporate Taxpayers, called the CNPJ (Cadastro Nacional da Pessoa Jurídica).
The CNPJ number is a fourteen-character identifier (since 31 July 2026 new CNPJs may also contain letters), with the first eight characters used to identify the legal entity, and the remainder utilized to identify the establishment (which can be a branch or headquarters) and to serve as a number validation (the last digits).
Is there a VAT registration threshold in Brazil?
No, Brazil does not impose a registration threshold. This means that VAT registration in Brazil is mandatory for all legal entities that engage in the provision of goods or services that are subject to the country’s indirect taxes (see below for more information on how VAT is calculated in Brazil).
How is VAT determined in Brazil?
Until the dual VAT (CBS/IBS) fully replaces them (2027-2033), Brazil does not use a unified VAT system, like in other countries. Instead, several indirect taxes are imposed on companies. We list these below:
- ICMS: the state-level tax on goods and services (as selected);
- ISS: municipal services tax;
- IPI: federal excise tax on industrialised goods;
- PIC/COFINS: the federal social contribution imposed on the gross revenue derived from goods and services.
When does the state VAT apply?
The ICMS, which is the VAT on sales and services imposed at the state level. Our team lists the main types of activities that make a company subject to this tax:
- It engages in the movement of merchandise (interstate or state-level);
- It provides services related to the provision of electric power;
- The company engages in interstate and intermunicipal transport services;
- It is a communications company offering intermunicipal and/or interstate solutions.
ICMS is usually due on a monthly basis; however, the calculation is different in the case of imports. If you want to set up a company in Brazil, our team can help you.
What are the current VAT rates?
If you want to open a company in Brazil and are subject to indirect taxes on goods and services, you can expect the following:
- State VAT (ICMS) with values between 4% and 25%;
- Federal excise tax (IPI) with an average value of 20%;
- Municipal taxes (ISS) with varying rates, between 2% and 5%.
Investors should be aware that the indirect tax rates (and some of the regulations assigned thereto) can vary on a state level.
Brazil is composed of 26 states and one Federal District, thus obtaining a total of 27 federative units which may determine their indirect tax rules and rates.
What are the requirements for VAT reporting?
Companies are expected to submit monthly returns and make monthly payments for the ICMS, the federal excise tax, and the municipal tax.
The calculations for the ICMS tax are to be kept in fiscal books and properly maintained.
Contact our team if you are interested in company formation in Brazil and wish to know more about the local taxes, including VAT in Brazil.
Dr. Jamil Abdo, Attorney at Law · 2 October 2026Dr. Jamil Abdo is one of the partners of Abdo Advogados.