CIDE – ROYALTIES PAYMENT.
By Edmo Colnaghi Neves (PhD).
Companies that send payments abroad as royalties under contracts with or without technology transfer are subject to a tax called CIDE (Contribution for Intervention in the Economic Domain Royalties).
However, in the case of technology transfer service contracts, this requirement is unconstitutional, which has led many companies to court. The leading case (the first case to be judged on the subject) is on the Supreme Federal Court’s agenda for August 6, 2025. Two judges of the panel have already voted differently on the matter, with the reporting judge voting for the partial unconstitutionality of the law, with regard to contracts without technology transfer.
If the unconstitutionality is declared, there may be modulation, when the decision regarding applies to future payments of the taxpayers and the right to recovery of amounts paid in the past being valid only for those who have already filed a lawsuit before said judgment, which may be concluded on August 6.
Therefore, we recommend evaluating the advisability of filing a lawsuit before this date.
July 2025.