Improving the Relationship Between Tax Authorities and Taxpayers in Brazil

Abstract

Brazilian tax authorities have traditionally had an adversarial relationship with taxpayers. Recent initiatives, however, show a paradigm shift that may bring taxpayers and tax authorities together. The country has made increasing efforts to reduce tax-related compliance costs over the past years. Additionally, the Brazilian tax administration has gradually improved the services available to taxpayers and treated them as clients rather than just ‘taxpayers’. Moreover, taxpayers have participated in the rulemaking process, notably in respect of tax guidance. The recent implementation of tax settlement agreements may be considered as significantly altering traditional concepts as it broke long-established misconceptions. Other initiatives to further enhance their relationship may be underway, including improving tax rulings and the mutual agreement procedure (MAP), cooperative compliance programs, and arbitration in tax matters

Note: Reprinted from INTERTAX, Volume 50, Issue 3, 2022, 218-230, with permission of Kluwer Law International.

Keywords: Brazil; enhanced relationship, collaboration, tax settlement agreements, rulings, MAP, cooperative compliance, arbitration