Starting on Tuesday, April 1, 2025, ten states in Brazil will raise the ICMS (Imposto Sobre Circulação de Mercadorias e Prestação de Serviços) tax on online imports from 17% to 20%. This increase will affect purchases made on international digital platforms, including popular sites like Alibaba (AliExpress), Shein, and Amazon. The states implementing this change are Acre, Alagoas, Bahia, Ceará, Minas Gerais, Paraíba, Piauí, Rio Grande do Norte, Roraima, and Sergipe.
The decision to raise the ICMS was made during the 47th Ordinary Meeting of the National Committee of Secretaries of Finance, Finance, Revenue or Taxation of the States and the Federal District (Comsefaz) on December 5, 2024. The move aims to align the tax treatment of imports with that applied to goods sold in the domestic market, thereby creating more balanced conditions for local production and commerce.
According to a statement from Comsefaz, the goal is to ensure competitive equality between imported and national products, promoting the consumption of goods produced in Brazil. The current ICMS rate of 17% was established in June 2023 and has been uniformly applied across the states participating in the Remessa Conforme program, which was created by the Federal Revenue to combat tax evasion in transactions involving foreign e-commerce sites.
The Brazilian Association of Mobility and Technology (Amobitec), which represents companies like Alibaba, Shein, and Amazon, has expressed concern over the tax increase. They warn that the total tax burden for consumers could surpass 50% with the new measure. Amobitec states, "This increase in ICMS represents more challenges for Brazilian consumers who buy products from abroad. Since the tax is calculated 'from within,' it does not only apply to the purchase price but also to the import tax, resulting in a greater impact on final prices."
Rodrigo Giraldelli, CEO of China Gate, a company specializing in international trade, noted that consumers from lower-income classes (C, D, and E) will be the most affected by the ICMS increase. He explained that a product currently priced at R$ 600 without taxes would cost R$ 1,156 after taxation. With the new ICMS rate, the same item would rise to R$ 1,200, marking a significant increase in final prices.
The tax adjustment will also affect the Simplified Taxation Regime (RTS), which applies to imports valued at up to $3,000. Under this regime, purchases with a customs value of up to $50 will incur a 20% import tax and a 20% ICMS. For items exceeding $50, the import tax will rise to 60%, with a fixed deduction of $20 applied to the total tax value.
In light of the impending increase, the e-commerce sector is bracing for potential declines in international purchases. According to the Federal Revenue, purchases from international e-commerce platforms fell by 11% in 2024 compared to the previous year. The number of products acquired from abroad dropped from 209.58 million in 2023 to 187.12 million in 2024, with a staggering 27% decline observed in January 2025 alone.
Rodrigo Spada, president of the National Association of State Tax Auditors (Febrafite), reinforced that the new tax rate aims to correct existing distortions in the market where imported products had a lower tax burden than domestic goods. He remarked, "This generated absurd situations, such as raw materials produced here being sent abroad for manufacturing and then re-imported at a lower final cost than products made entirely in Brazil."
Despite the tax increase, the Brazilian government hopes that the higher prices on imported goods will favor local industries, particularly in sectors like fashion, electronics, and beauty accessories. Elias Menegale, a tax specialist at Paschoini Advogados, explained that the government anticipates that the increase will protect domestic commerce and strengthen the national economy. However, he also pointed out that small entrepreneurs who rely on international e-commerce for low-cost products may face tighter profit margins as a result.
While the new ICMS rate is expected to impact consumers and small businesses, Giraldelli emphasized that formal importers, whether small or large, already pay relatively high taxes. He noted that consumers who previously enjoyed low or no taxes on purchases up to $50 will now face increased costs, while established importers have been subject to rigorous taxation and compliance measures.
As a result of the Remessa Conforme program, China Gate has witnessed growth in its client base, registering at least 312 new importers in the Integrated Foreign Trade System (Siscomex) from January to March 2025, surpassing previous years. In 2024, the company achieved R$ 24 million in logistics services between Brazil and China, up from R$ 18 million the year before.
In conclusion, while the increase in the ICMS tax on online imports aims to protect local industries and enhance tax revenue, it poses significant challenges for consumers, particularly those from lower-income brackets. The upcoming changes are set to reshape the landscape of international e-commerce in Brazil, compelling consumers to reconsider their purchasing habits.
