Inclusions and exclusions proposed by the Senate are rejected by the Chamber; CCJ approves collection on advertising services

The House rejected, on Tuesday (9), the substitution Bill proposed by the Senate to the Complementary Law 183/01 and maintained the text from the Chamber, which rules on the Taxes on Services of Any Nature (ISS), or on the State Value-Added Tax on Services and Circulation of Goods (ICMS) in several activity sectors. The matter will be submitted to the President’s sanction.

Graphic services

According to the text approved by the Chamber in 2002, and now maintained by the deputies, graphic composition, photocomposition, plate setting, zincography, photolithography, and confection of graphic printings will be subject to ISS.

The exception to that classification, which subjects to collection of ICMS, will occur when those services are destined to posterior commercialization or industrialization, even if incorporated to other goods.

The Complementary Law 116/03, which regulates the collection of ISS, currently mentions only graphic composition, photocomposition, plate setting, zincography, lithography and photolithography. There are no references to graphic printings and to the exception in which the incidence of ICMS occurs.

Other rejections
The maintenance of the text approved by the Chamber in 2002 was agreed by parties’ leaders and guaranteed by the House with the votes of 388 deputies. Other items of the substitution bill from the Senate to PLP, which also were rejected, included services in the list of ISS taxable services, such as corporative rent of movable goods/chattel; national ecological and thematic parks; brokerage or intermediation of titles in general, securities, and contracts closed in Stock Exchange and Commodities and Futures Exchange; and the subscription television services in municipal areas.

The senators proposed to exclude from ISS real estate incorporation, fund administration, consortium administration, credit and debit card administration and the like; the collection, remittance or delivery of mail, documents, objects, goods or values, couriers and the like, when exploited by Empresa Brasileira de Correios e Telégrafos (ECT, the Post).

Rates
According to the Law, the maximum tax rate is 5%. The substitution bill by the Senate, rejected by the Chamber, proposed two new rates, 2% and 10%.
The lower would be used to tax procurement, brokerage, or intermediation of titles in general, securities, and any contracts closed in the scope of Commodities Exchange. The higher would be applied to distribution and sale of tickets and other bingo products.

CCJ approves the collection of ISS on advertising services
The Committee on the Constitution and Justice and Citizenship approved, on Thursday (4) the substitution bill of the Committee on Finances and Taxation to the Complementary Bill 230/04, from the Deputy Antonio Carlos Mendes Thame (PSDB-SP). The substitution bill includes, in the list of taxable services by the ISS, the distribution and release of texts, images and other advertising materials.

According to the substitution Bill approved by the Committee on Finances and Taxation, the municipal tax will not be charged on the distribution of advertising in communication media – newspapers, newsletters, radio, television, books or internet. But the creation of outdoor signs, T-shirts, signs and brochures, among other forms of advertising, is included in the scope of ISS.

The companies also will be able to exclude from their calculation basis the amounts regarding the rent of spaces effectively used in the distribution of advertising and the legal discounts favoring advertising agencies.

The rapporteur at CCJ, Deputy Leonardo Picciani (PMDB-RJ), presented a favorable opinion to constitutionality, legality and legislation technique of the original bill and of the substitution bill, which has the preference for the voting by the House, where it awaits the decision to integrate the agenda.

Report - Eduardo Piovesan / Sílvia Mugnatto
Editing - Rejane Xavier
Translation - Positive Idiomas Ltda