Correct tax classification and proper valuation of traded goods are essential elements to guarantee the reliability of transactions carried out in foreign trade.
Both are essential for accurately estimating statistics and, consequently, the applicable tax rate.
The Federal Government's role in classifying and valuing products is governed by the International Convention on the Harmonized Commodity Description and Coding System, incorporated into the national legal system by Decree No. 97,409 of 1988, and by the General Agreement on Tariffs and Trade of the World Trade Organization (GATT/WTO), admitted in Brazil by Decree No. 1,355 of 1994.
The Common External Tariff, in turn, provides guidance for the user to classify their merchandise for tax purposes. If there are any doubts, it is possible, under Brazilian law, to initiate a formal process with the Brazilian Federal Revenue Service to clarify any questions.
The process, known as Consultation on the Tax Classification of Goods, is in line with the Trade Facilitation Agreement of the World Trade Organization and represents an important tool available to taxpayers, enabling transactions to be carried out safely.
The Brazilian Federal Revenue Service (RFB) provides taxpayers with a Compendium of Rulings on Consultation Solutions and Divergence Solutions, which have binding effect in tax matters and protect any taxpayer who applies them.
Direct the NCM code é, therefore, the act of identifying, both fiscally and technically, the goods that are the subject of the transaction., it being certain that Failure to accurately illustrate the product will result in a fine and the obligation to pay the difference.. Therefore, to avoid incorrect allocation and, consequently, the application of fines on taxes arising from the transaction, it is essential to seek the advice of a specialist to review the correct nomenclature.
Source: SISCOMEX
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Put Gian Lucca Jorri, Lawyer, graduated in Law in 2016 from the Catholic University of Santos. Area of Expertise: Customs Law and Tax Law, OAB (Brazilian Bar Association): 404.759
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