Brazil consults on simplified Pillar Two ETR safe harbour

Simplified ETR safe harbour proposed for 2027

The first part would amend Normative Instruction RFB No. 2,228/2024 to incorporate the simplified effective-tax-rate safe harbour from the OECD Inclusive Framework’s January 2026 Side-by-Side package. The consultation describes rules for the simplified test and tested jurisdiction, simplified profit or loss and covered taxes, later covered-tax adjustments, allocation between constituent entities, transparent entities, eligibility restrictions, entry and re-entry, and integrity measures. Receita says the proposed safe-harbour provisions would apply from 1 January 2027.^[1]

Brazil’s existing Additional CSLL applies to constituent entities of multinational groups with consolidated annual revenue of at least EUR 750 million in at least two of the preceding four fiscal years. Law No. 15,079/2024 establishes a 15% minimum effective rate and authorises Receita to regulate safe harbours and update the rules to preserve qualified domestic minimum top-up tax status.^[2][3]

Foreign-profit deductions are a separate strand

The second part would add Articles 11-A and 30-A to 30-C to Normative Instruction RFB No. 1,520/2014. Receita says the provisions would govern deductions for foreign income tax paid by a controlled or associated entity under a foreign domestic minimum tax, fiscal consolidation, group-taxation, fiscal-transparency or equivalent regime. The consultation does not establish that a particular foreign tax is deductible.^[1]

What groups should do

In-scope groups should identify Brazilian constituent entities, tested jurisdictions and Brazilian-resident companies with controlled or associated foreign entities under the listed regimes. They should compare current calculation data with the proposed simplified profit, tax and allocation categories and consider technical comments before 16 November. Existing payment rules continue meanwhile: Receita’s current guidance states that the Additional CSLL is payable by the last business day of the seventh month after the fiscal year-end.^[1][2]

No return amendment, new payment deadline or safe-harbour election follows from the consultation. The attached proposal was not text-extractable in this run, so exact article wording, optional adjustments, exclusions, transition mechanics and foreign-tax deduction conditions remain for final-instruction review.^[1]