In a recent Consultation Solution, published in mid-June, the Federal Revenue Service changed its understanding and considered that amounts remitted abroad resulting from a software usage licensing agreement should be taxed by PIS/COFINS-Import.
According to the IRS, this position reflects the ruling handed down by the STF (ADIs 1945 and 5659) in which it was decided that software licensing or usage assignment contracts should be taxed by ISS, and not by ICMS, whether for standard software (off-the-shelf) or those produced to order.
In turn, the PIS/COFINS-Import legislation establishes that the remittance of amounts abroad as “consideration for the service provided” will be subject to taxation.
Although the Consultation Solution represents a change in the Tax Authorities’ understanding, it is a fact that such a position was a “sure thing”, since, in February of this year, the same body considered that the activities of licensing and granting the use of standardized or customized software have the legal nature of a service.
In April of this year, a new understanding from the Federal Revenue Service defined that such amounts, whether resulting from the renewal or acquisition of a new license, are also subject to taxation at source by Income Tax, having the nature of royalties.
What is clear, once again, is that taxpayers are forced to live with the collection fury of public entities, because those who celebrate the Supreme Court’s ruling removing the incidence of ICMS on the licensing or transfer of “off-the-shelf software”, since they would be taxed by ISS at a lower rate, perceive, in fact, that there was basically a redirection of the tax burden from the States to the Union.
It is important to highlight, however, that the Federal Revenue’s understanding until then was in the opposite direction, that is, the non-incidence of PIS/COFINS-Import on such remittances, so that our legal system prohibits the retroactive collection from those taxpayers who stopped paying the contributions before this new position.
