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Starting in April 2025, international online purchases will become more expensive in Brazil. States have decided to increase the ICMS tax from 17% to 20%, directly impacting consumers. The measure aims to protect the domestic market, but it is controversial among consumers and experts. Check out all the details of this change and how it will affect your pocket!
One of the significant change in taxation of international purchases carried out over the internet is about to come into force in Brazil.
From April 2025, the Tax on Circulation of Goods and Services (ICMS) will be increased from 17% to 20% on orders coming from abroad.
The decision, announced by the states this Friday (6), is part of an effort to align taxation between national and imported products, according to the National Committee of Secretaries of Finance, Treasury, Revenue or Taxation of the States and DF (comsefaz).
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The measure was discussed and approved during the 47th Ordinary Meeting of Comsefaz, held in Foz do Iguaçu (PR).
According to the Committee, the main objective is to promote more balanced conditions for the domestic market, reinforcing the competitiveness of Brazilian products in the face of the growing popularity of international e-commerce.
How will the ICMS increase be implemented?
The new 20% rate will apply to all international orders, but its implementation will depend on state laws.
According to Comsefaz, in states where the ICMS modal rate is less than 20%, it will be necessary for the Legislative Assemblies to approve the change.
Therefore, the application of the tax may vary depending on the region of the country.
This is not the first time an increase in the rate has been discussed.
In April 2024, the states considered raising the ICMS to 25%, but the proposal ended up being postponed after considerations about the impact on the market and revenue.
Now, with the 20% definition, the focus is on balancing revenue without causing an abrupt increase in consumer costs.
Other taxes already applied to international purchases
In addition to ICMS, international purchases of up to US$50 are also subject to a 20% import tax, which came into effect in August 2024.
Therefore, the total cost for consumers using foreign e-commerce platforms could increase significantly.
Comsefaz argued that the new ICMS rate seeks to align the tax treatment of imported products with that applied to goods sold on the domestic market.
This strategy, according to the Committee, aims to promote national production and stimulate the consumption of items manufactured in Brazil.
Impact on the economy and consumption
The increase in ICMS was justified as a way of ensuring “competitive equality” between national and imported products.
The objective, according to the states, is to strengthen the Brazilian production sector, which faces direct competition from international e-commerce platforms.
This measure also seeks to expand job creation in the country and increase state revenues at a time of fiscal restrictions.
On the other hand, e-commerce experts believe that the impact could be felt mainly by consumers.
The increase in prices for international purchases may reduce access to products that, in many cases, are not available on the Brazilian market or are sold at less competitive prices.
Small businesses may also be affected. Many of them rely on imports to supply their stocks or produce goods locally.
With limited profit margins, the increase in tax burden can pose an additional challenge for these businesses.
What do the states say about the change?
In an official note, Comsefaz stated that the increase in ICMS reflects the states' commitment to the development of national trade and industry.
“This change reinforces the states’ commitment to fairer taxation and contributes to protecting the domestic market from the challenges of a globalized scenario,” highlighted the Committee.
According to the agency, the decision took into account the rates already applied by the states.
In cases where the current rate is less than 20%, implementation will depend on approval by the respective Legislative Assemblies.
The increase in ICMS was presented as part of a broader effort to ensure greater balance in taxation between imported and domestic goods.
Despite this, the measure generated mixed reactions, both from consumers and representatives of the business sector.
How to prepare for changes?
With the increase in ICMS expected to come into effect only in April 2025, consumers and traders still have time to adapt.
Experts recommend financial planning for international purchases and, whenever possible, looking for alternatives in the national market.
In the case of states that do not yet apply the 20% rate, it is important to follow the procedures in the Legislative Assemblies, as changes may vary regionally.
Meanwhile, foreign marketplaces and e-commerce platforms will have to adjust their systems to reflect the new taxes in final prices.
This adaptation will be essential to ensure that consumers are clear about the total costs of purchases, including import tax and ICMS.
Raising taxes on international purchases represents an attempt to balance the conditions between imported and domestic products, but it also brings challenges for consumers and entrepreneurs.
As the effective date of the new tax rate approaches, it will be essential to assess the impacts of this measure on the market and consumer behavior.
And you, how do you evaluate this change? Can the increase in ICMS benefit the Brazilian economy or will it end up harming access to products and services?
Brazil continues to be the most expensive country in the world to do business in, the most controlling when it comes to generating jobs and the most ungrateful for those who dare to invest.
The tax burden on the circulation of goods and consumption is a monumental obstacle to economic development. Here, we tax what we earn, what we have, what we buy, what we sell and even what we donate.
In the absence of incentives to make domestic industry competitive, entrepreneurs are hesitant to invest in Brazil. This not only weakens the local production sector, but also forces the country to depend on goods and technologies manufactured abroad. Without policies that foster innovation and efficiency, imports become an inevitable choice, worsening the trade deficit and further exposing the Brazilian economy to fluctuations in the global market.
The “Brazil Cost” is not the result of chance, but of the maintenance of a bloated, expensive and inefficient state machine, created to support a political elite that lives in luxurious conditions, far above its voters. Brazilian politicians do not govern as representatives of the people, but as princes, sheiks, rajahs or maharajas of a neo-monarchy disguised as a democracy.
The increase in ICMS from 17% to 20% on imported products is yet another example of a predatory tax system that prioritizes revenue collection without considering the economic and social impacts. Instead of encouraging competitiveness and modernizing the economy, the government burdens consumption and makes production inputs more expensive, suffocating companies and penalizing the end consumer. The impact felt throughout the production structure worsens inequalities and perpetuates the inefficiency of the economic model.
Furthermore, the Federative Pact, which should guarantee a fair distribution of the collected resources, acts as a readaptation of feudalism, where the federative units are mere collectors to support the central government. The return of these resources to the population is pitiful, with declining public services, with more appointees and cronies than elected officials, which rarely justifies the abusive tax burden.
The distortions in the income distribution system are glaring in every sense. Inequalities in Brazil can be compared to the temperature ranges on Mars: they freeze the poorest in paralyzing poverty and comfort the richest in disproportionate luxury. Meanwhile, tax increases perpetuate the concentration of wealth, favoring the elites who hold political and economic power to the detriment of the majority of the population.
Brazil urgently needs a tax reform that simplifies, rationalizes and distributes the burden more fairly, instead of continuing to expand a system that is already widely recognized as one of the most complex and unfair in the world.
Would it be possible to expect Brazilian society to exercise sufficient vigilance and pressure to prevent tax reform from simply perpetuating the model that fuels inequality?
Unfortunately, reality points to the opposite. Just as the serfs and peasants of the feudal system passively accepted the impositions of the feudal lords, the majority of Brazilians seem to resign themselves to the decisions of the political and economic elite, conforming to a system that oppresses them and perpetuates their conditions of submission.
Thus, Brazil will continue to be the most expensive country in the world to do business in, the most controlling in terms of generating jobs and the most ungrateful for those who boldly insist on investing.