This blog was last updated on August 26, 2025

According to the schedule set by the Government, 2026 will be CBS’s “test year”, which will in fact take effect in 2027, with the extinction of the PIS and Cofins.

Approved by the National Congress in December 2023, the Tax Reform establishes the replacement of five taxes (ICMS, ISS, IPI, PIS and Cofins) with two new ones, the IBS (Tax on Goods and Services) and the CBS (Contribution on Goods and Services), plus the IS (Selective Tax), which aims to discourage the consumption of products harmful to health or the environment.

According to the schedule set by the Government, 2026 will be CBS’s “test year”, which will in fact take effect in 2027, with the extinction of the PIS and Cofins. Still in 2027, the IPI rates are also expected to be reset to zero, with the exception of products produced in the Manaus Free Trade Zone.

After that, there will be a period from 2029 to 2032 in which the ICMS and ISS rates will begin to be reduced for the gradual application of the IBS, until, in 2033, the new tax is effectively implemented.

It is a short period of time considering the complexity that a change of this size will entail not only for the tax area, but also for other areas of companies, such as purchases, sales and logistics, not to mention the costs necessary for investments and adaptation not only to the approved changes, but also to those planned. After all, there is still a lot left to be published, both in relation to the calculation of taxes and the possible changes in the required ancillary obligations.

The transition period promises to be complex because of tax parallelism. During it, organizations must live with the new determinations, without ceasing to comply with current obligations.

For this reason, companies that wish to minimize possible negative impacts on their business should start planning the implementation of the new rules now.

This is a process that involves several fronts, and was one of the main topics discussed at the Tax Summit 2024, held in early May, in São Paulo.

One of them is the training of tax and tax professionals, who previously acted more operationally and, from now on, should be more strategic and active in supporting decision-making that will directly affect the amount paid in taxes and the pricing of products and services.

In addition, other analytical skills required of tax and tax professionals will be the use of tools and software to help them face such a huge change.

Technology, by the way, promises to be the main protagonist in this Tax Reform transition process, since it allows not only the automation of the operation, but, above all, the simulation of scenarios and impacts of the changes envisaged in the new legislation, the combination of old and new taxes and the updating of the rules according to the approval and publication of the regulations.

To assist companies in this intricate period, Sovos will soon launch a simulator that allows organizations to analyze the impacts between old and new tax legislation on their tax operations.

An “add-on” to the Tax rules tax determination and calculation engine, the proposal is that this new feature of the tool can be used by any company, including those that do not use the solution.

It is important to emphasize that this impact analysis process will not only be necessary before the transition to the Tax Reform, but also during it, precisely because of the tax parallelism and all the complexity expected for the period.

In the coming years, we will see a radical change in the importance of fiscal and tax areas for all companies. Therefore, the golden tip at the moment for professionals who work in these sectors is to invest, now, in technological solutions that help them navigate this current with more peace of mind.

Source: Channel 360