On 15 November 2017, the Municipality of São Paulo published Law 16,757/2017. The Law addresses, among other issues, the taxing of software as a service (“SaaS”), the online streaming of video and music services (such as Netflix and Spotify) and online advertising (such as Facebook and YouTube ads).
This means that from 13 February 2018 the following services will be taxed at 2.9% if supplied to the Municipality of São Paulo:
- the “processing, storage or hosting of data, texts, images, videos, electronic pages, applications and information systems, among other formats, and the like”;
- “making available, without definitive transfer audio, video, image and text content through the Internet, respecting the immunity of books, newspapers and periodicals (except where ICMS applies)”; and
- the “insertion of texts, drawings and other advertising and publicity materials, in any medium (except in books, newspapers, periodicals and in the modalities of sound broadcasting services and sounds and images of free and gratuitous reception)”.
The Municipality of Rio de Janeiro had already published a similar law on 16 October 2017 (Law 6,263/2017), which will come into force on 14 January 2018. The Rio de Janeiro rates are 5%, 2% and 3%, respectively, for each of the above.
For more information see here, here and contact me.
ISS Municipal Services Tax SaaS streaming services
Last modified: February 2, 2023