At the close of 2024 and the start of 2025, the Government of the State of São Paulo implemented significant changes to the ICMS (Tax on the Circulation of Goods and Services) tax benefits regime, affecting various economic sectors. Through decrees published in the State’s Official Gazette, the renewal and exclusion of tax benefits were enacted in line with the “São Paulo in the Right Direction” program guidelines.
These changes aim to modernize state management, attract investments, and optimize public expenditures. The revision of tax benefits is part of the strategy for fiscal balance and economic efficiency.
Renewals Published in December 2024
In December 2024, Decrees No. 69.207/2024, 69.208/2024, 69.268/2024, 69.269/2024, 69.274/2024, 69.287/2024, 69.288/2024, and 69.289/2024 established the extension of tax benefits until December 31, 2026. Sectors affected include:
- Food: Benefits related to products such as rice, milk, and other basic basket items;
- Medicines and Health: Covering pharmaceuticals and surgical equipment;
- Transport and Energy: Exemptions and reductions on specific operations;
- Fuel: Focusing on operations involving petroleum derivatives and renewable energy.
Updates from January 2025
On January 3, 2025, Decrees No. 69.291/2025, 69.292/2025, and 69.293/2025 were published, retroactive to January 1, 2025, extending benefits covering:
- Personal hygiene products;
- Agricultural inputs;
- Clothing and other textile items.
Main Extended Benefits
- ICMS Exemptions:
- Imported products for research;
- Operations with fruits, vegetables, lubricants, auto parts, products for the disabled, and passenger transport.
- Reductions in Taxable Base:
- Machinery, appliances, used vehicles, meat, sugar, cosmetics, and basic basket items.
- Granted Credit:
- Operations with wheat flour, raw milk, textiles, and footwear.
Exclusions and Rationalization of Benefits
As informed by the São Paulo State Treasury Department (SEFAZ-SP), 88 benefits were excluded, including reductions in the taxable base for purebred horses and sand, as well as exemptions for rubber tree seedlings and oysters.
Impacts and Recommendations
Companies in the affected sectors should review their tax operations to ensure proper alignment with the new regulations. On the other hand, the exclusions of benefits require attention to changes in the tax burden and potential impacts on operational costs.
For more information and support in adapting to the new provisions, please contact our office. We are available to guide you on the impact of these changes on your business.