A brief introduction to Brazil’s all powerful tax department.
What does it do?
The Brazilian Federal Revenue Department (Receita Federal do Brasil, “RFB”) is part of the Ministry of Finance. It is responsible for:
- the enforcement and collection of Federal taxes (including IOF, IRPJ, CSLL, PIS/COFINS and IPI) for both individuals and businesses;
- customs inspections and audits;
- assisting in the prosecution of various crimes (including money laundering, piracy, illegal importing, tax evasion and corruption of public officials).
It is also responsible for the management of the National Registry of Legal Entities (Cadastro Nacional de Pessoas Jurídicas, “CNPJ”) whose number is used for just about everything that a business does in Brazil.
Finally, the RFB also controls the import licence registration system (“Siscomex”), which is required for a company to import goods from abroad.
How does it operate?
The RFB has very sophisticated systems and auditors. Its staff is selected through a highly competitive public entrance exam.
The RFB also has a supercomputer whose purpose is to cross-check various pieces of information collected from taxpayers and other government bodies. The RFB’s IT budget is approximately R$2 billion per year.
How to you deal with the RFB?
Unfortunately, dealing with the RFB is far from easy. It has bureaucratic communication system, with very limited assistance being available on any matters other than very basic information.
In all but the rarest of cases, face-to-face meetings require prior bookings, which must be made via the internet.
Brazil’s tax rules are extremely rigid and fines for non-compliance are applied regardless of the taxpayers’ intent.
Contact me if you require further information.
Last modified: November 26, 2019