On June, 16th, was published the Ordinance PGFN No. 14,402/20, which, based on the tax transaction provided for in Law No. 13,988/20, establishes that taxpayers with debts registered in active debt may adhere, between 07.01.20 and 12.12.20, to certain form of tax transaction, according to COVID 19, called “exceptional transaction”.

The adherence to the program shall be made within the period in question, through Regularize, a program that can be accessed on PGFN’s website, for debts up to R $ 150 million.

The program of the PGFN offers installments with reduced entry fees and discounts of up to 100% in fines and interest, although the company must demonstrate, however, that it does not have the financial capacity to pay the full amounts of the debt, through: i) company information contained in the PGFN system; ii) verification of the revenues obtained in 2019 and in the first half of 2020; iii) analysis of the company’s total assets; iv) verification of the number of employees; and, v) cash generation capacity, considering the impacts of the pandemic.

Other information and/or documents may be requested by the PGFN, which, after analyzing all the data, will prove the taxpayer’s real situation in relation to the original debt amount, sending, from there, proposals to the taxpayer for the payment in installments with discounts, so that this make the choice.

Item II of article 9 of the said decree details the general conditions of this transaction:

• Payment, as an initial payment, of a monthly amount equivalent to 0.334% of the consolidated value of the debt for 12 months, with the remainder being paid with a reduction of up to 100% of the amount of interest, fines and legal charges, observing the limit of up to 50% on the original debt amount, in up to 36 installments, each installment being determined by the highest amount between 1% of the gross revenue of the immediately previous month and the amount corresponding to the division of the consolidated amount by the amount of installments requested;
• Payment, as an initial payment, of a monthly amount equivalent to 0.334% of the consolidated value of the debt, for 12 months, and the remainder paid with a reduction of up to 100% of the amount of interest, fines and legal charges, observing the limit of up to 45% on the original debt amount, in up to 48 installments, with each installment determined by the highest amount between 1% of the gross revenue of the immediately previous month and the amount corresponding to the division of the consolidated amount by the amount of installments requested;
• Payment, as an initial payment, of a monthly amount equivalent to 0.334% of the consolidated value of the debt, for 12 months, and the remainder paid with a reduction of up to 100% of the amount of interest, fines and legal charges, observing the limit of up to 40% on the total value of each credit subject to negotiation, in up to 60 installments, each installment being determined by the highest amount between 1% of the gross revenue of the immediately previous month and the amount corresponding to the division of the consolidated value by the amount of benefits requested;
• Payment, as an initial payment, of a monthly amount equivalent to 0.334% of the consolidated value of the debt, for 12 months, and the remainder paid with a reduction of up to 100% of the amount of interest, fines and legal charges, observing the limit of up to 35% on the total value of each credit subject to negotiation, in up to 72 installments, each installment being determined by the highest amount between 1% of the gross revenue of the immediately previous month and the amount corresponding to the division of the consolidated value by the amount of benefits requested;

Despite the proposals being sent to the taxpayers after the analysis of their situation by the PGFN, the following general conditions are established: i) the entry will be 4% of the total amount of the debt, which can be paid in up to 12 months; ii) the remaining balance, discounting interest and fines, can be paid in up to 72 months (the greater the number of installments, the lower the discount); iii) discounts, up to 100% in interest and fines, will vary according to the taxpayer’s ability to pay, the debt situation and the installment payment chosen – the more often, the lower the discount; and, iv) the total reduction must be at most 50% of the total debt amount.

Our team is available to assist in this and other tax law issues. For further information please contact our Tax Team by the following e-mails: rmarques@zaslaw.com.br or zaslaw@zaslaw.com.br.