Brazilian president sanctions Law that introduces the Qualified Domestic Minimum Top-up Tax according to OECD Pillar Two rules


Brazilian president sanctions Law that introduces the Qualified Domestic Minimum Top-up Tax according to OECD Pillar Two rules


On December 30, 2024, President Luiz Inácio Lula da Silva approved, without vetoes, Bill No. 3,817/2024, which was converted into Law No. 15,079/24.

The new Law establishes an additional Social Contribution on Net Income (CSLL) applicable to multinational companies established in Brazil with consolidated annual revenue exceeding € 750 million (approximately BRL 4.8 billion). 

Based on Provisional Measure No. 1,262/24, which would lose its validity in March 2025, the measure aims to align Brazils tax practices with the guidelines of the Organization for Economic Cooperation and Development (OECD), in accordance with Pillar 2 of the BEPS (Base Erosion and Profit Shifting) project, which seeks to combat the erosion of the tax base and the shift of profits to low-tax countries. 

Main Points of Law No. 15,079/24

  • Global Minimum Taxation: It establishes a minimum effective rate of 15% for the Social Contribution on Net Income (CSLL) of multinationals, in accordance with the global agreement to combat tax erosion (GloBE Rules). This additional value, when applicable, will be levied on the profits of companies in Brazil belonging to multinational groups whose consolidated annual revenue exceeds the limit of € 750 million in at least two of the last four consecutive fiscal years.
  • Extension of Benefits: It amends Law No. 12,973, with the purpose of extending until 2029 the presumed credit of 9% on profits earned abroad. This prevents profits in other jurisdictions from being taxed without considering losses in other international operations. The consolidation was only scheduled to last until 2024, and the extension guarantees greater tax security for companies.

It is important that taxpayers remain aware of the possible impacts of this measure, especially multinationals that achieve a lower effective tax rate due to the use of tax benefits such as tax amortization of goodwill, interest on equity or tax incentives from Sudam and Sudene, as they may face a significant increase in the tax burden.  

Furthermore, Law No. 15.079/24 determines that the Executive Branch must present, in the first half of 2025, a proposal to review the Universal Bases Taxation (TBU) rules to introduce a new element of the OECD Pillar 2 guidelines, the Income Inclusion rule, which allows the State to charge companies domiciled in its territory for their undertaxed subsidiaries abroad.    

It is worth noting that the Brazilian government will have to monitor the effects of the measure and may implement a tax reform to consolidate an alignment with OECD standards.  

Azevedo Sette Advogados’ Tax team is available to provide advisory and clarifications on the matter. Follow our social medias for more details in next week.