Tax Reform: How to prepare your company for the transition starting in 2027

By: Gilberto Gagliardi Neto

The implementation of the Consumption Tax Reform enters a new phase starting in 2027, which requires companies not only to pay attention to the new rules for calculating and collecting taxes, but also to conduct an advance analysis of the impacts on contracts, internal processes, systems, pricing, and cash flows.

From 2027 onwards, there will be significant changes to the tax system, including the elimination of PIS and Cofins, the effective implementation of CBS, and the beginning of the transition from the current model to IBS, in addition to the institution of the Selective Tax. The transition from ICMS and ISS to IBS will occur gradually between 2029 and 2032, with the full implementation of the new model planned for 2033.

1. Review of business contracts

One of the main points of attention is in medium- and long-term contracts , especially those signed before the full implementation of the new tax system.

Changes to the tax structure may modify the effective tax burden, the costs of operations, and the economic formation of contracts themselves. Therefore, it is advisable to evaluate clauses related to:

Price adjustments and revisions;
passing on tax changes;
responsibility for paying taxes;
Change in tax burden;
maintaining economic and financial equilibrium;
possibility of renegotiation due to legislative changes;
Treatment of tax credits;
Issuance of tax documents and ancillary obligations.

Law No. 214/2025 itself established specific mechanisms for the economic and financial rebalancing of certain administrative contracts affected by the institution of the IBS and CBS. For private contracts, however, the legislation did not establish an equivalent mechanism for automatic application, and the analysis remains linked to the contractual provisions and the legislation applicable to each legal relationship.

2. Pricing and margin formation for operations

The Tax Reform also requires a reassessment of the current methodology for price formation and margin calculation .

The gradual replacement of current taxes with the IBS and CBS, combined with the system of financial credits and new calculation rules, may alter the effective tax cost of certain transactions.

Therefore, companies that maintain long-term contracts or pre-established price lists should assess whether the conditions currently in place will remain economically suitable during the transition period.

3. Internal processes and systems

Compliance should also extend to the systems used by companies, especially those related to:

issuing tax documents;
Product and service registration;
tax classification;
Tax rate parameterization;
tax assessment;
accounts payable and accounts receivable;
Accounting for credits and debits;
tax and financial reconciliation;
Integration between ERP, tax, accounting, and finance.

The technical documentation for the NF-e (Brazilian electronic invoice) already provides for the adaptation of tax documents to the fields related to IBS (Brazilian VAT) and CBS (Brazilian social contribution), reinforcing that technological adaptation should be treated as an integral part of the transition process.

4. Cash flow and impact of Split Payment

Another aspect that deserves attention is the evolution of the Split Payment system , which could alter the financial dynamics of companies by linking the collection of new taxes to the settlement flow of transactions.

This scenario makes it even more important to assess not only the nominal tax burden, but also the effects of the reform on working capital, sales receipts, supplier payments, and financial availability .

5. The time to act is now.

Although the definitive implementation of the new model will occur gradually, preparation should not be left until 2027.

We recommend that companies begin, now, a diagnosis of the impacts of the Tax Reform , considering, in an integrated manner:

(i) existing and new contracts;
(ii) pricing and price review;
(iii) supply and customer chain;
(iv) tax systems and documents;
(v) accounting, tax and financial processes;
(vi) utilization of tax credits; and
(vii) impacts on margin, cash flow and working capital.

Tax reform should therefore be viewed not only as a change in tax legislation, but as a business adaptation project involving the areas of Tax, Legal, Finance, Accounting, Sales and Technology.

Our team remains available to assist in identifying the impacts of the Tax Reform on contracts, operations, and internal processes , as well as in defining the necessary measures for a safer and more planned transition.