State of Rio de Janeiro regulates deposits to the “Fundo Orçamentário Temporário”

Four months after the publication of State Law no. 8.645/19, which replaced the “Fundo Estadual de Equilíbrio Fiscal” (FEEF) with the “Fundo Orçamentário Temporário” (FOT), the state of Rio de Janeiro has issued State Decree 47.057/20, which obligates Rio de Janeiro’s taxpayers to deposit the amounts calculated based on their tax benefits.

With the exception of some situations expressly enacted in the decree, taxpayers are required to deposit the amount equivalent to 10% of the difference between the ICMS, calculated with and without the tax incentives granted by the State of Rio de Janeiro, similarly to what already was being done during the FEEF.

The deposit must be made by taxpayers by the 20th of the month following that of ICMS’s calculation, and will already be due in May in relation to the amounts calculated in April 2020.

Failure to make deposits in the FOT subjects the taxpayer to severe penalties, such as fines and the loss of the respective tax benefit.

Even as the new FOT legislation intends to remedy some of the existing unconstitutionalities in the already revoked FEEF legislation, we understand that other remaining irregularities allow the legal questioning of the matter.

We are available to discuss and assist you in making decisions about the best strategy in face of this new obligation.