Taxpayers with VAT liabilities to settle with the State of Sao Paulo may still enjoy a measure of amnesty for these debts.
Through Decree No. 58.811, which was published on 28 December 2012 and created the "Special Program for Payment in Installments (PEP)" related to the State VAT (Imposto sobre Circulação de Mercadorias e Serviços or "ICMS"), taxpayers with ICMS debts to the state of Sao Paulo with tax triggering events occurring until 31 July 2012-whether they are already assessed or not, whether they are already registered in the state's list of debtors or not, and whether they are already being charged in a tax collection action-will be able to pay such debts with the following discounts over the penalty and over the interest:
- 75 percent discount over the penalty and 60 percent discount over the interest for the payment in a lump sum
- 50 percent discount over the penalty and 40 percent discount over the interest for the payment up to 120 instalments, which will be financially restated in accordance with the number of instalments chosen by the taxpayer
In case of ICMS debts that are currently being charged in tax assessments, it shall be applied, cumulatively to the discounts above, the discounts of the penalty worth:
- 70 percent for the payment of the debt within the 15-day term from the receipt of the tax assessment;
- 60 percent for the payment of the debt within the 16th day and the 30th day from the receipt of the tax assessment; and
- 45 percent in the other situations of payment of debt being demanded in a tax assessment.
The decree also sets forth that the State Treasury Department and the State Attorney's Department will rule on the utilisation of accrued ICMS credits for the payment of ICMS debts in accordance with the PEP.
Taxpayers who wish to take advantage of the abovementioned discounts may avail of the PEP from 1 March to 31 May 2013.