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Indirect Tax in Brazil refers to a complex system of taxes levied on the consumption of goods and services. These taxes are typically included in the price of goods and services and are ultimately borne by the end-consumer.
Brazil's indirect tax system is notoriously complex, featuring multiple taxes at federal, state, and municipal levels. Key taxes include ICMS (state VAT on goods and services), ISS (municipal service tax), PIS/COFINS (federal social contributions on revenue), and IPI (federal excise tax on manufactured products). The proposed Tax Reform (PEC 45/2019 and PEC 110/2019) aims to consolidate many of these into a dual IVA system: CBS (federal) and IBS (state/municipal), with a potential combined rate around 25-27%.