Law Project proposes changes in ITD rates in RJ

The Law 3,419/2017, authored by the Executive Branch of the State of Rio de Janeiro, is designed to reduce the exemption from tax on causa mortis transmission and donation of property or right (ITD) for individuals’ residential real, changing their rates and calculation bases.

Proposed amendment

Currently, real estate exempt from ITD are those with amounting the equivalent to up to 100 thousand UFIR-RJ (about BRL 310 thousand, considering 1 UFIR 2017 is equivalent to BRL 3,119). If the LP is approved, the exemption range to 15 thousand UFIR (about R $ 46.7 thousand) should be reduced.

The proposal also increases the amount of tax rates ranges from two to four. Today, the tax is 4.5% for assets up to 400,000 UFIR, and 5% for assets higher than this value. With the update, the new rates should be divided as follows:

- 4,5%, for amounts up to 100 thousand UFIR

- 6% from 200 to 300 thousand UFIR

- 7% from 300 to 400 thousand UFIR

- 8% for amounts over than 400 thousand UFIR

It is important to highlight that there is a range without application of aliquots (between 100 thousand and 200 thousand UFIR). There should probably be some kind of adjustment for this range.

Duration

According to the LP, the law will enter into force at its publication, and will be effective as of Jan-01-2018.

Course of the project

Currently, committees at Legislative Assembly of Rio de Janeiro are analyzing the project so that it may be sent to the vote.

On Oct-03-2017, the project received 95 amendments and left the agenda. It is expected to return to the plenary on Oct-10 after going through the board of leaders.