Brazil advances Pix updates and tax reform implementation

Brazil is undergoing significant shifts in its financial and tax landscapes. The Central Bank is developing new features for the Pix payment system, including an offline mode using NFC technology to facilitate transactions in areas with unstable internet. Other planned enhancements include a machine learning-based fraud detection indicator and a “split payment” mechanism to integrate with new tax regulations.

Simultaneously, the national tax reform is restructuring consumption taxes. The reform aims to redistribute fiscal pressure by expanding the tax base and eliminating cumulative taxation. While essential items like basic food baskets and certain medicines will receive exemptions or reductions, new taxes will apply to previously exempt sectors, such as real estate rentals and the sale of permanent corporate assets.

The reform introduces the Contribution on Goods and Services (CBS), which will replace PIS, Cofins, IPI, and IOF. Large-scale lessors earning over R$ 240,000 annually from 2026 onwards will be subject to CBS starting in 2027. The Imposto Sobre Bens e Serviços (IBS), unifying ICMS and ISS, will follow a transition period beginning in 2029, with full implementation expected by 2033.