The Optional Taxation Regime for Substitution Tax (ROT-ST) for the retail sector may be implemented in the State of Rio. The authorization is contained in Bill 2.744/23, authored by the Executive Branch, which the Legislative Assembly of the State of Rio de Janeiro (Alerj) approved this Tuesday (09/04), in a single discussion. The measure will now be submitted to Governor Cláudio Castro, who has up to 15 business days to sanction or veto it.
The purpose of the optional regime is to waive the payment of the tax corresponding to the supplement of the Tax on Circulation of Goods and Services (ICMS) withheld by substitution tax. This supplement occurs in cases where the price charged to the final consumer is higher than the calculation basis used to charge the substitution tax.
The tax substitution was created to facilitate the collection of ICMS. It involves an advance withholding of the tax, based on a forecast of collection, which is charged only to the first taxpayer in the production chain of a given product.
Only taxpayers who sign a commitment not to demand reimbursement for transactions with end consumers at a price lower than the calculation basis used to collect the substitution tax may join the regime. Companies that opt for the regime must remain in it for at least twelve months.
The first adhesion to the optional regime will also imply waiver, in relation to previous years, of the refund resulting from carrying out transactions with the final consumer with a price lower than the calculation basis used to calculate the substitution tax liability debt.
The option for the optional regime does not authorize the refund or compensation of amounts already paid. The Executive Branch will regulate the scope of taxable events that occurred in the five years prior to the option for the regime. The government must also regulate the way the regime operates, deadlines and other conditions for adherence. The measure internalizes ICMS Agreement 67/19, with the amendments of ICMS Agreement 207/19. The proposal complements Law 2.657/96, which regulated the collection of ICMS in Rio.
The government received a petition from the Brazilian Franchising Association (ABF) and the Federation of Industries of the State of Rio de Janeiro (Firjan) requesting that the ROT be adopted in Rio, following the example of São Paulo, Minas Gerais, Rio Grande do Sul and other federated entities. “The ROT basically consists of the possibility given to the taxpayer to continue applying the previous system in their operations, if this is in their interest”, justified Governor Cláudio Castro in the text of the bill.
He also pointed out that the regime differs from tax benefits in that it is a mechanism to facilitate compliance with tax obligations, attributing potential gains and losses to the parties involved with the sole purpose of simplifying inspection by the tax authorities and compliance by taxpayers.
Source: https://www.alerj.rj.gov.br/Visualizar/Noticia/64611