On January 20, 2025, the PGFN/MF Ordinance No. 95/2025 (the "Ordinance") was published in the Federal Official Gazette, regulating the dismissal of debt guarantees arising from a cast vote of the Federal Government at the Taxpayers Council of Administrative Appeals ("CARF"), provided that taxpayer´s ability to pay is duly recognized by the Attorney-General of the National Treasury ("PGFN").
Article 3, Item I of the Ordinance allows a taxpayer to offer the proof of its tax compliance as a guarantee, with the option to present other guarantees, as long the preference order of Article 11 of Law No. 6,830/1980 ("LEF") is respected.
The application must be submitted through the REGULARIZE system , along with: (i) the list of the outstanding debts to be guaranteed; (ii) an independent auditor's report on the corporate entity's financial statements; (iii) a list of free assets and documentation proving their ownership and valuation; (iv) a commitment to inform PGFN of the sale, disposal or encumbrance of the indicated assets and its substitution; (v) a commitment to settle, within 90 days, the debts enrolled into overdue tax liability, or due after the application.
Once the application has been received, an administrative proceeding will be opened to confirm the authenticity of the documentation and information submitted by the taxpayer, including if the taxpayer had a valid tax clearance certificate for at least nine of the prior 12 months from when the lawsuit was filed. In the event of any inconsistencies or errors, the taxpayer will be notified that they must rectify these issues within 10 days.
The National Treasury may revoke the compliance if:
- The taxpayer does not have federal tax clearance certificate for more than 90 days;
- The taxpayer doesn't report the sale, disposal, encumbrance, depreciation, or expiration of the assets indicated for the recognition of tax compliance, and doesn't offer another free-and-clear asset as a substitute;
- The lawsuit is found in favor to the National Treasury;
- The National Treasury rejects the assets indicated to replace those initially listed; or
- Divergences are verified in the registration, asset, or economic-fiscal information provided by the taxpayer, which compromise the certification of its ability to pay.
In any of these scenarios, the taxpayer will have 10 days to rectify any issue identified or to file an appeal. Once the recognition of tax compliance is revoked, standard debt collection procedures will resume, which may include normal enforcement actions.
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