BRAZIL Trends and Developments Contributed by: Flávia Santanna Benites, Priscila Camargo, Jhonatan Poiana and Sandro Miguel Junior, Ernesto Borges Advogados
In recent decades, tax has often been treated as an operational function, focused mainly on the fulfilment of ancillary obligations and the mitigation of assess- ments. However, the transformations brought about by the Tax Reform significantly expand the strategic relevance of tax management within organisations. Tax governance now plays a role similar to that of financial governance, standing as a capital element for the preservation of competitiveness, access to credit facilities, attraction of investments, and generation of value. It is in this scenario that the Brazilian Consumption Tax Reform is framed, representing perhaps the greatest institutional transformation of the Brazilian tax system in recent decades. Tax reform Brazilian agribusiness is facing a change that will require increased attention in the coming years. The tax reform represents not only a change in rates or specific legislation adjustments, but a profound change in the structure of the domestic tax system. The reform was approved by Constitutional Amend- ment No 132/2023 and regulated mainly by Ancillary Law 214/2025, subsequently adjusted by Ancillary Law 227/2026. The new model creates two main taxes, IBS and CBS, which will gradually replace ICMS, ISS, PIS and COFINS. The transition will take place between 2026 and 2033, requiring companies to adapt technology, review internal processes, and restructure tax governance. The main innovation is the so-called broad non- cumulativeness, allowing greater use of tax credits along the production chain. This means that the cor- rect organisation of tax information will cease to be merely a compliance requirement and will become a factor related directly to cash generation and business competitiveness. From compliance to strategy: the new role of fiscal governance The agribusiness production chain is extensive and involves suppliers, rural producers, co-operatives, grain storage operators, carriers, agro-industries, trading companies and exporters.
Each of these steps generates documents, infor- mation and tax records that need to be accurate to ensure the full use of tax credits. Any inconsistency can lead to relevant financial losses. Therefore, tax governance is no longer an exclusive concern of the tax departments and becomes part of the strategic agenda of executive boards and boards of directors. Investments in integrated systems, peri- odic audits, tax compliance and internal controls no longer represent mere administrative costs and begin to function as instruments for asset protection and value generation. The tax credit as an economic asset One of the most significant consequences of the reform is the transformation of tax credits into effec- tively strategic assets. In an environment of tight mar- gins and growing global competition, properly recog- nised tax credits represent effective cost reduction, increased operational efficiency, and strengthening of the financial position of companies. This new scenario influences corporate operations, merger and acquisition processes, corporate restruc- turings, joint venture formation and investment deci- sions. The quality of tax credits becomes part of the financial analysis of the business in the same way that already occurs with real estate assets, receivables, inventories and projected cash flow. Connection with agribusiness financing Tax governance is related directly to new forms of agribusiness financing. In addition to traditional rural credit, the sector is increasingly accessing the capi- tal market through instruments such as Investment Funds in Agro-industrial Production Chains (FIAGROs) and Agribusiness Receivables Certificates (CRAs). Investors, banks, funds and managers are increas- ingly assessing the ability of companies to manage their risks, produce reliable information, and maintain robust internal controls. Relevant tax problems may directly impact future cash generation, reducing the ability to pay financial obligations and compromising the attractiveness of the investment. For this reason, companies that demonstrate a high degree of tax gov-
29 AGRICULTURAL LAW 2026
CHAMBERS.COM
Powered by FlippingBook