State Complementary Law No. 189/2020: Special Amnesty Program for Rio de Janeiro State Tax Credits

On December 29, 2020, Complementary Law No. 189/2020 was published, creating the Special Amnesty Program for ICMS (“PEP-ICMS”) in the State of Rio de Janeiro, as authorized by ICMS Agreement nº 87/2020.

This amnesty program covers ICMS credits, registered or not as overdue state tax liability, arising from taxable events that occurred until August 31, 2020, except for those related to ICMS-ST.

Enrollment in PEP-ICMS is subject to the payment of the first (or sole) installment of the program. The deadline for requesting enrollment in the amnesty program is 60 days from the publication of the law, which can be extended only once by the Executive Branch for a maximum of 60 days.

The program offers the following benefits if the conditions mentioned below are met:

• Payment in a single instalment, with a 90% reduction in the amount of legal penalties and late-payment fines;
• Payment in six monthly and successive instalments, with an 80% reduction in the amount of legal penalties and late-payment fines;
• Payment in 12 monthly and successive instalments, with a 70% reduction in the amount of legal penalties and late-payment fines;
• Payment in 24 monthly and successive instalments, with a 60% reduction in the amount of legal penalties and late-payment fines;
• Payment in 36 monthly and successive instalments, with a 50% reduction in the amount of legal penalties and late-payment fines;
• Payment in 48 monthly and successive installments, with a 40% reduction in the amount of legal penalties and late-payment fines; and
• Payment in 60 monthly and successive installments, with a 30% reduction in the amount of legal penalties and late-payment fines.

It is important to note that admittance to the program is contingent on the disclosure of debts and on the withdrawal of lawsuits and administrative proceedings that discuss such debts.

Potential scenarios that can lead to the program’s cancellation include unpaid installments and more than 60 days of tax payments due to the state by any establishment of the legal entity that enrolls in the amnesty program, in relation to taxable events that occurred after joining the program.

PEP-ICMS is also applicable to IPVA (tax due upon vehicles property) and ITD (transfer/donation tax) credits. SEFAZ/RJ and PGE/RJ will edit rulings with additional proceedings/rules for this program. This Complementary Law is valid as of the date of its publication, December 29, 2020.

For more information related to this Legal Update, please contact our Tax team.