Rebeca Duran

Rebeca Duran

Staff Writer
The Brazil Business


Tax Reduction for Brazilian Ports

Rebeca Duran

Rebeca Duran

Staff Writer
The Brazil Business


The quality of Brazilian ports is questionable, so the government decided to invest in this sector with a tax reduction regime. This article explains how this regime works and who can apply for it.

Brazil is a vast country, with great potential, but infrastructure problems in so many sectors hold back the development of the country. Government programs – such as Brazil Maior –were launched in order to stimulate the development of the Brazilian economy as well as to overcome problems of the national infrastructure.

Reporto: Modernization of Brazilian Ports

In December of 2004 the Brazilian national congress approved a new law project that aims to stimulate investments in the recuperation, modernization and expansion of Brazilian ports, reducing the logistic obstacles and barriers that exist in the infrastructure of Brazil.

The law created a new regime: the Regime Tributário para Incentivo à Modernização e Ampliação da Estrutura Portuária no Brazil, which is a taxation regime of incentives for the modernization and expansion of port structures in Brazil. The regime, known as Reporto, provides lots of incentives for the beneficiaries of the regime.

Who Can Apply for the Regime?

The beneficiaries of Reporto are the port operator, the port management concessionaire, the company authorized to explore port facilities of mixed or exclusive private use – including the ones that work in offshore platforms –, companies of dredging, dealers or licensees in customs areas of secondary zones and the dealers of railway transport.

Benefits of Reporto

Companies benefited by Reporto are exempt from Import Tax and IPI after the expiry of five years from the date of occurrence of the taxable event. The companies are also suspended from the payment of the following taxes charged upon sales and purchases on domestic market and taxes charged upon the import process.

On purchases and sales

  • Tax on Industrialized Products – known as IPI
  • Contribution to PIS/ Pasep
  • Contribution to Social Security Financing – known as Cofins.

On import process

  • Tax on Industrialized Products – known as IPI
  • Contribution to PIS/ Pasep
  • Contribution to Social Security Financing – known as Cofins
  • Import tax – also known as II.

Goods and Services Comprised in Reporto

The tax suspension is conceded to sales and purchases in the domestic market and in importation of machines, equipments, spare parts and other goods acquired or imported by companies accredited in Reporto. The goods should be designated to the company's fixed asset to the exclusive utilization in the services below:

  • loading, unloading, storage and handling of goods and products
  • additional systems to operational support
  • environmental protection
  • security and monitoring systems of flow of people, goods, products, vehicles and vessels
  • dredging
  • education and training of workers, including the implementation of Vocational Training Centers.

Others admitted in the Tax Suspension

The suspension also applies to products classified under the 86.01, 86.02 and 86.06 positions of the Mercosur Common Nomenclature (NCM), when used in the execution of services to transport goods in railroads. Rails and other elements of railways, classified in position 73.02 of NCM are also targets of tax suspension.

Apply for Tax Reduction

The qualification of Reporto should be requested through the Federal Revenue of Brazil (RFB) form – available in the Federal Revenue web page. The form must be submitted to the Delegacia da Receita Federal do Brasil (DRF) or to the Delegacia Especial da Receita Federal do Brasil de Administração Tributária (Derat) with jurisdiction in the company's headquarter accompanied by specific documents.

Necessary Documentation

  • commercial registry
  • constitutive act
  • articles of association
  • documents of shareholders election – if were partnership by shares
  • CPFand address of all private persons shareholders
  • CNPJ and address of all legal entities shareholders
  • legal act or concession agreement published in Union Official Journal – DOU
  • registry certificate of previous qualification as a port operator

From Procedures to Qualification Concession

To accept a Company in Reporto, DRF or Derat will examine the regularity of the requirement and the documentation delivered, verify the fiscal regularity related to taxes administrated by RFB andtheninform the company of its' decision.

The qualification will be formalized through the Executive Declaratory Act (ADE) issued by the Delegate of the DRF or Derat with jurisdiction over the company's headquarter. ADE will be published in Union Official Journal.