Perse Program: Federal Revenue Service regulates tax benefits for the events sector

Program reduces federal tax rates to zero for 60 months

On November 1, the Federal Revenue Service published Normative Instruction No. 2,114/2022, which regulates the tax benefits laid out under the Emergency Program for the Recovery of the Events Sector (“Programa Emergencial de Retomada do Setor de Eventos” - Perse).

Launched in 2021, the program aims to counter the negative impacts of the pandemic on the events industry, and establishes, among its provisions, a 0% tax rate for the following federal taxes:

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• Employee’s profit participation tax and Public service employee savings tax (PIS/Pasep);​ ​
• Contribution for the financing of social security (Cofins);​ ​
• Social contribution on net income (CSLL); and ​
• Corporate income tax (IRPJ).​



The tax benefit provided for in the law applies to income and revenues received over a 60-month period, from March 2022 to February 2027.




Tax-advantaged activities




To have their tax rates zeroed, the business activities performed by companies must be listed under Annex I or Annex II of ME Ordinance No. 7,163/2021 and must also be related to:

• Congresses; exhibitions; sporting, social, advertising and cultural events; business fairs; concerts; parties; festivals; symposiums and performances in general; catering services; night clubs; and event and music venues,
• Hospitality services;
• Management of movie theaters; and
• Tourist services, as per article 21 of Law No. 11,771/2008.​



Keep in mind that the requirements set for zeroing the tax rates levied on income and revenues stemming from such activities differ depending on whether the activity in question is listed under Annex I or Annex II of the ordinance:




Business activities	Requirement
Under Annex I	The taxpayer should have been performing the corresponding activity by March 18, 2022.
Under Annex II	The taxpayer should have been registered in good standing with the Tourism Service Providers Registry (Cadastur) by March 18, 2022.




Those working in the events sector that have benefitted from the Perse using the program for activities unrelated to those listed above must declare the corresponding taxes or else they will be subject to a tax audit.

Furthermore, the aforementioned tax benefit does not apply to amounts classified as financial and non-operating income, nor to those classified as other income and expenses.




Aspects of each assessment method




The Perse program applies to taxpayers that calculate their Corporate Income Tax (IRPJ) under the Taxable Income, the Deemed Profit, and the Estimated Profit methods. When assessing their tax-advantaged revenues, taxpayers must comply with the particularities legally stipulated for each method:




Assessment method	Particularities for income calculation
Corporate Income Tax (IRPJ) calculated under the Taxable Income method	Profit from tax-advantaged activities must be declared only for income determined between March 2022 and February 2027
Annual calculation of Corporate Income Tax (IRPJ) and Social Contribution on Net Income (CSLL	The benefit applies only to monthly estimates from March 2022 to February 2027
Corporate Income Tax (IRPJ) and Social Contribution on Net Income (CSLL) calculated under the deemed or estimated profit methods	Revenue received between March 2022 and February 2027 must not be factored in




The program’s benefits, however, do not apply to taxpayers that have opted for the Simplified Taxation System (Simples Nacional).




Strategic partnership to seize tax benefits




Domingues e Pinho Contadores has a team dedicated to guiding companies from various segments as to the opportunities for tax optimization by making the best use of all benefits at their disposal. You can rely on our support: dpc@dpc.com.br.