Brazil VAT Calculator
How Much Is VAT in Brazil?
Brazil has no single national VAT in 2026. The closest equivalent for goods is the state ICMS, generally 17% to 23% on sales within a state (18% in São Paulo) and 4%, 7% or 12% on interstate sales. It is charged alongside federal IPI on manufactured goods, PIS/COFINS on company revenue (3.65% or 9.25%) and municipal ISS on services (2% to 5%). The 2023 tax reform replaces all of these with a dual VAT — federal CBS and state/municipal IBS — phased in from 2027 to 2033; in 2026 both appear on invoices only as a 1% test.
How to calculate Brazil VAT
ICMS is calculated "por dentro" — it is included in its own tax base — so the rate is applied to the tax-inclusive price. With the 18% São Paulo rate, to add ICMS to a net price divide it by 0.82; to find the ICMS inside a gross price multiply it by 0.18.
- Add ICMS: BRL 100 net ÷ 0.82 = BRL 121.95 gross (BRL 21.95 of ICMS, which is 18% of 121.95)
- Find ICMS in a price: BRL 121.95 gross × 0.18 = BRL 21.95 of ICMS
Use the Brazil VAT calculator above for any amount, or compare Brazil with every other country in our VAT rates by country table.
Brazil VAT Rates Overview
Every VAT rate currently in force in Brazil
Current VAT Rates (2026)
| Rate type | Rate | Applies to |
|---|---|---|
| ICMS internal rate (state VAT) | Generally 17%-23% by state (18% in Sao Paulo) | Sales of goods, interstate transport and communications within a state; some goods 12% or 25%+ |
| ICMS interstate rates | 12% / 7% / 4% | 7% from South/Southeast to North/Northeast/Centre-West and Espirito Santo; 12% other routes; 4% imported goods |
| IPI (federal excise-type VAT) | 0% to over 300%, typically 5%-30% | Manufactured and imported goods, rate set by tariff code |
| PIS/COFINS non-cumulative | 1.65% + 7.6% (9.25%) | Revenue of companies under the actual-profit regime, with credits |
| PIS/COFINS cumulative | 0.65% + 3% (3.65%) | Presumed-profit companies and certain sectors, without credits |
| ISS (municipal service tax) | 2%-5% | Services, rate set by the municipality |
| CBS / IBS test rates (2026 only) | 0.9% CBS + 0.1% IBS | Shown on invoices in 2026 as a test; offset against PIS/COFINS or waived for compliant taxpayers |
VAT History and Local Rules in Brazil
How the rates got here, and country-specific points to watch
Key VAT milestones
- 2026: CBS/IBS test year: 0.9% CBS and 0.1% IBS reported on invoices alongside existing taxes
- 2025: Complementary Law 214/2025 enacted, regulating CBS, IBS and the Selective Tax
- 2023: Constitutional Amendment 132 approved the consumption tax reform
- 2002: Non-cumulative PIS introduced (COFINS followed in 2004)
- 1988: Federal Constitution created ICMS, extending the state tax to transport and communications
Is the VAT rate the same everywhere in Brazil?
No. ICMS rates are set by each of the 27 states (generally 17%-23% on internal sales, with 4%, 7% or 12% on interstate sales) and ISS by each municipality (2%-5%); the Manaus Free Trade Zone has special incentives. The new IBS will also allow state and municipal rates.
Good to know
2026 is a test year: invoices must show CBS at 0.9% and IBS at 0.1%, but the amounts can be offset against PIS/COFINS, and payment is waived for taxpayers who meet the ancillary reporting obligations, so the overall tax burden in 2026 is unchanged.
From 1 January 2027, PIS and COFINS are abolished and CBS is charged at its full rate (less 0.1 point), IBS is charged at a symbolic 0.1% until 2028, most IPI rates are reduced to zero except for goods also produced in the Manaus Free Trade Zone, and the Selective Tax (Imposto Seletivo) on harmful goods begins.
From 2029 to 2032 ICMS and ISS are progressively reduced (by 10%, 20%, 30% and 40%) while IBS increases; both old taxes are abolished in 2033, when CBS and IBS are fully in force. The combined reference rate is expected to be around 26%-28%, subject to Senate resolution.
Zero-Rated and Exempt Supplies in Brazil
The difference matters: zero-rating keeps input-VAT recovery, exemption does not
Zero-rated supplies (0%)
VAT is charged at 0%, but the seller can still recover input VAT on related costs:
- Exports of goods (exempt from ICMS, IPI, PIS/COFINS with credit maintenance)
- Exports of services generating foreign currency (PIS/COFINS, ISS)
VAT-exempt supplies
No VAT is charged, and the seller generally cannot recover input VAT on related costs:
- Many basic food basket items (PIS/COFINS 0% and state ICMS reliefs)
- Books, newspapers and periodicals (constitutional immunity from ICMS and IPI)
Brazil VAT Registration & Compliance
Key facts for businesses registering for and reporting VAT in Brazil.
| Local name | ICMS, IPI, PIS/COFINS and ISS, transitioning to dual VAT: CBS (federal) and IBS (state/municipal) |
|---|---|
| VAT number format | CNPJ: 14 digits (e.g. 12.345.678/0001-95), plus state Inscricao Estadual for ICMS |
| Registration threshold | No general threshold: companies need a CNPJ and, for ICMS, a state registration; small businesses up to BRL 4.8 million revenue may use Simples Nacional |
| Non-resident businesses | No simplified registration for foreign suppliers under the current system; taxes on imported services are generally paid by the Brazilian customer. From 2027 foreign suppliers to consumers fall into the CBS/IBS system |
| Filing frequency | Monthly, through SPED digital bookkeeping (EFD ICMS/IPI, EFD-Contribuicoes) and DCTFWeb |
| Filing and payment deadline | Varies by tax and state; PIS/COFINS are generally paid by the 25th of the following month |
| E-invoicing / reporting | Electronic invoices (NF-e, NFC-e, CT-e, NFS-e) have long been mandatory; from August 2026 CBS/IBS fields must be completed on tax documents |
| Tax authority | Receita Federal do Brasil (federal taxes); state SEFAZ (ICMS); municipalities (ISS) |
Thresholds, deadlines and e-invoicing rules are revised regularly. Always confirm current requirements with Receita Federal do Brasil (federal taxes); state SEFAZ (ICMS); municipalities (ISS) before relying on them.
Cross-Border Sales and Refunds in Brazil
Selling into the country from abroad, and getting VAT back
Cross-border rules
Digital services and e-commerce: Under the current system, digital services from abroad are generally taxed through the Brazilian payer (ISS, PIS/COFINS-import and withholding taxes), while some states levy ICMS on digital goods. From 2027, CBS and IBS apply to imports of services and intangibles, with foreign suppliers and platforms liable for sales to Brazilian consumers.
Tourist VAT refunds: No generally operational tourist VAT refund scheme.
For the general rules, see the reverse charge mechanism, VAT on digital services, VAT invoice requirements and VAT refunds for tourists and businesses.
Compare VAT Rates
VAT rates in neighboring and similar economies
Frequently Asked Questions
Common questions about VAT in Brazil
What is the current VAT rate in Brazil?
Brazil has no single national VAT rate in 2026. The main state tax on goods, ICMS, is generally 17% to 23% depending on the state (18% in São Paulo), and it sits alongside federal IPI, PIS/COFINS (3.65% or 9.25%) and municipal ISS on services (2% to 5%). The new CBS/IBS dual VAT is only being tested at 1% in 2026 and phases in from 2027 to 2033.
How do I calculate VAT in Brazil?
To add 18% VAT, multiply the net price by 1.18. To remove it from a VAT-inclusive price, divide by 1.18; the difference is the VAT. The calculator at the top of this page does both.
What changes with Brazil's tax reform in 2026?
2026 is a test year. Businesses show CBS at 0.9% and IBS at 0.1% on invoices, but these amounts are offset against PIS/COFINS or waived for compliant taxpayers, so the existing taxes still apply in full.
When will CBS and IBS fully replace Brazil's current taxes?
CBS replaces PIS/COFINS from 2027. IBS gradually replaces ICMS and ISS from 2029 to 2032, and the new dual VAT is fully in force from 2033.
Who needs to register for VAT in Brazil?
Registration threshold: No general threshold: companies need a CNPJ and, for ICMS, a state registration; small businesses up to BRL 4.8 million revenue may use Simples Nacional. Foreign businesses: No simplified registration for foreign suppliers under the current system; taxes on imported services are generally paid by the Brazilian customer. From 2027 foreign suppliers to consumers fall into the CBS/IBS system.
Sources
Official and professional references used for this page
Last reviewed on 27 September 2026.