On August 5, 2022, Ordinance PGFN No. 6.941 was published, amending Ordinance PGFN No. 6.757/2022, which regulates the settlement of federal government and FGTS credits.

The most noteworthy change is that item II of Article 36 of Ordinance PFGN No. 6.757/2022 was revoked, removing the restriction that tax loss credits and a negative balance of CSLL only be used to amortize interest, fines and legal charges. However, these others regulations were maintained: That tax loss credits and a negative balance of CSLL can be used to pay (i) debts considered irrecoverable or hard to recover  and (ii) debts classified as non-existent or paid off, as recognized by a final judicial decision or by means of federal writs of payment issued in favor of the taxpayer, in disfavor of the federal government.

In addition, Ordinance PGFN No. 6.941/2022 amended §1 of Article 46 of Ordinance PFGN No. 6.757/2022 to clarify that debtors with debts enrolled in federal overdue tax liability with a total amount between BRL 1 million and BRL 10 million may propose or receive a proposal for an individual simplified settlement.

For more information regarding this Legal Update, please contact our Tax team at: TaxpartnersTC@mayerbrown.com.