lei Kandir

Lei Kandir is a Brazilian law enacted in 1996 that exempts the export of goods and services from federal taxes, mainly the ICMS state tax. Its purpose is to make Brazilian exports more competitive globally by removing tax costs associated with exports. However, this exemption results in significant loss of revenue for Brazilian states, which rely on ICMS for their budget. As a consequence, states have sought compensation from the federal government to offset the revenue shortfall caused by Lei Kandir. The law balances promoting exports with fiscal challenges faced by states due to reduced tax collection.