Included in the scope of the 2015-2018 National Exportation Plan, the purpose of which is to enhance tax mechanisms and regimes intended to support exportations, Brazil Federal Revenue Service completed the legal procedure for accreditation with the Special Customs System under Digital Registration Control [Regime Aduaneiro Especial de Entreposto Industrial sob Controle Informatizado do Sistema Público de Escrituração Digital] (Recof-Sped).
Recof-Sped was regulated under Normative Rule RFB nº 1612/2016 and accreditation procedures were set up under Administrative Rule COANA nº 47/2016.
Such special industrial warehousing regime allows the beneficiary company to import or purchase in the local market, with suspended taxes, goods that will be submitted to processing of products, parts or pieces intended for exportation or to the domestic market.
Companies willing to be accredited and benefit from the regime will have to meet the following criteria, among others:
- Export at least 80% of the amount imported each year, and income must exceed US$ 5 million in annual exports;
- Industrialize at least 80% of supplies imported or purchased in the local market under the regime; and,
- Be current with their digital tax entry legal responsibility [Escrituração fiscal digital] (EFD).
That regime allows the beneficiary company to import or purchase supplies in the local market to be used on their production process, to process/manufacture them into final products and export them without collecting taxes on any of these preceding stages. It is also possible to sell a part of the production and even some imported supplies into the domestic market, in which case applicable taxes will be levied following sales, without penalties. That allows significant deferral of taxes, which leads to considerable relief in companies’ tax flow.
Recof-Sped has potential to attract both companies currently not benefiting from any special customs system and companies accredited with Recof (original regime still in force) and Draw-back because Recof-Sped was conceived as (and apparently it is indeed!) a special customs regime that facilitates control, is less bureaucratic and more beneficial from a taxation standpoint.