New Legislation Standardizes CARF Tax Debts

On December 21, 2023, the Brazilian Federal Revenue enacted Normative Instruction No. 2,167/2023 ("the Instruction"), which was published in the Federal Official Gazette. The Instruction provides rules for the standardization of tax debts—referred to in Article 25-A of Decree No. 70,235/1972—resulting from judgments handed down by the Administrative Council for Tax Appeals ("CARF") in favor of the federal government, based on the casting vote referred in Article 25, paragraph 9 of the Decree.

In cases decided in favor of the federal government by a majority vote by CARF, the Instruction provides for the exclusion of fines resulting from an upheld infraction and cancellation of Tax Representation for Criminal Purposes, in addition to the following possibilities:

• Payment of the principal, without penalties and default interest;
• Payment through the use of tax deductions, negative CSLL calculation basis, and writ of payment ("precatório");
• Payment in up to 12 installments; and
• Guarantee of issuance of Tax Clearance Certificate.

The taxpayer must file an application—accompanied by payment of the full amount of the debt, or the first installment of the credit—within 90 days of acknowledgment of the final verdict.

If this acknowledgment occurred during the term of Provisional Measure No. 1,160/2023, and up to the date of publication of the Instruction—December 23, 2023—then the 90-day period will be counted from the date of publication.

Furthermore, the Instruction provides the ability to file an appeal in cases of denial of (i) the request; (ii) the use of tax losses and negative CSLL calculation basis, or (iii) the exclusion of the installment payment.