On March 1, 2020, Provisional Measure No. 1,034/2021 ("MP"), which amends Law No. 7,689 / 1988 to increase the rates of the Social Security Contribution on Net Income ("CSLL") payable by legal entities that operate in the financial sector, was published in the Official Gazette.

According to the MP, the CSLL rate, currently levied at 15% on the taxable income accrued by legal entities that operate in the financial sector, will be:

  • 20% until December 31, 2021, and return to 15% as of January 1, 2022 for the following entities: private insurance companies, capitalization companies, distributors of securities; foreign exchange and securities brokers; credit, financing and investment companies; real estate credit companies; credit card administrators; leasing companies; savings and loan associations; as well as stock, commodity and futures exchanges
  • 25% until December 31, 2021, and 20% as of January 1, 2022, for banks of any kind.

The new rates will be applicable only from the first day of the fourth month following the publication of the MP-in other words, from July 1, 2021-in accordance with the 90-day holding period set forth by the Federal Constitution.

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Founded in 2001, Tauil & Chequer Advogados is a full service law firm with approximately 90 lawyers and offices in Rio de Janeiro, São Paulo and Vitória. T&C represents local and international businesses on their domestic and cross-border activities and offers clients the full range of legal services including: corporate and M&A; debt and equity capital markets; banking and finance; employment and benefits; environmental; intellectual property; litigation and dispute resolution; restructuring, bankruptcy and insolvency; tax; and real estate. The firm has a particularly strong and longstanding presence in the energy, oil and gas and infrastructure industries as well as with pension and investment funds. In December 2009, T&C entered into an agreement to operate in association with Mayer Brown LLP and become "Tauil & Chequer Advogados in association with Mayer Brown LLP."

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This article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.