The ICMS Agreement No. 106/2017 was published in the Official Gazette of October 5, 2017, which “regulates State Tax (ICMS) collection procedures for transactions involving digital goods and merchandise traded through electronic data transfer and grants exemption on exits before departure intended for the final consumer.”

The collection of ICMS in these operations was authorized through ICMS Agreement No. 181/2015, and the requirement in the State of São Paulo was suspended pursuant to Decree No. 61,791/2016, which amended the ICMS Regulation, in view of the need to wait “to define the place of occurrence of the taxable event to determine the establishment responsible for paying the tax.”

The new Agreement establishes, firstly, that transactions with these goods, marketed through electronic transfer of data, before the exit to the final consumer are exempt from ICMS.

In this sense, the said provision establishes that the tax will be due at the time of the sales in the country or the imports downloaded, and the payment shall be made to the States where the purchasers of the goods or digital goods are domiciled or established. The tax will be due even if the software is made available through periodic payment.

The taxpayer of the operation will be the legal entity that owns the site or the electronic platform where the transfer takes place and must have state registration with the States in which to carry out the operations. This requirement may be, at the discretion of each federated unit, waived.

Furthermore, said Agreement allows the attribution of responsibility for collection to third parties, namely (i) to the one that makes the offer, sale or delivery of the merchandise by virtue of a marketing contract; (ii) the financial intermediary, including the credit card administrator or other means of payment; (iii) the purchaser of the good or digital goods, when the taxpayer or responsible person is not registered in the State of destination; and (iv) the debit card administrator or the financial intermediary responsible for the exchange in the import operations.

Finally, the Agreement determines that the legal entity that sells the good must issue the Electronic Invoice (“NF-e”), model 55 to support the operation.

The amendments introduced by the aforementioned Convention will be ratified by the States, which shall publish Decrees internalizing these standards, for effective collection and fulfillment of ancillary obligations about these operations.