Beware of hidden losses

Companies and rural producers who make sales outside of São Paulo face a growing fiscal challenge: the risk of losing ICMS credits due to formal or operational errors. “What we see most in our daily work are producers who assume that the operation with another state works the same way as in SP. But a single wrong code or missing accreditation is enough for the credit to be denied. A poorly entered credit or an operation without proper documentation in a sale outside of SP can completely nullify the recovery of ICMS. This type of loss is invisible but recurrent,” says Altair Heitor, CFO of the tax consultancy Palin & Martins. The complexity arises from the lack of standardization between states. Despite the agreements of Confaz, each federative unit adopts its own rules for accreditation, tax rates, tax substitution, and calculation of the tax rate differential (DIFAL). This makes interstate operations require additional care, especially regarding the correct use of CFOP, NCM, and ...