Supermarkets in São Paulo have met with Gilberto Kassab, the Secretary of Government and Institutional Relations, requesting changes to the new consumption tax rules that have been in effect since January. Specifically, they are asking for a reform in the repayment structure for the ICMS tax, which is levied on the circulation of goods and services, to allow for the return of overpaid taxes in six installments instead of the current 24.

This request comes amidst a broader package of reforms being implemented by the São Paulo government in preparation for national tax reforms concerning consumer taxes. Changes made in January by the Treasury Department have removed a range of goods from the ICMS substitute tax regime, impacting 12 economic sectors and more than 130 items, including household products, medicines, and certain food and beverage products.

The implications of these changes are significant for both consumers and businesses. By lengthening the repayment period for overpaid ICMS tax, supermarkets argue they are facing increased financial strain, especially as they navigate other economic challenges. The negotiations with Kassab highlight the ongoing discussions regarding tax policy in Brazil at both state and national levels, reflecting the need for a balanced approach that supports local businesses while reforming the taxation system.