Exemption from PIS-Pasep and Cofins for corn bran and oil passes in the Senate

The tax exemption that already applies to soybeans will be expanded to the sale of corn derivatives. The Senate Plenary approved this week the amendment to Law 12.865, of 2013, which suspended the incidence of the Contribution to the Social Integration and Public Servant Asset Formation Programs (PIS/Pasep) and the Contribution to the Financing of Social Security (Cofins) on the sale of soybeans, to extend the same benefit to corn bran and oil. The project (PL 1.548/2022) now goes to presidential approval.

The Economic Affairs Committee (CAE) had already approved a replacement for PL 1.548/2022, by senator Cidinho Santos (PL/MT), with a favorable opinion from senator Tereza Cristina (PP-MS). She defended the project again during the plenary session.

“This is a super important project because it brings balance to the corn product. We already have soybeans that have this exemption, which is extremely important for animal feed, for our proteins. Brazil is the largest exporter of animal protein in the world, including beef, chicken and pork. And corn also makes up this ration”, explained Tereza Cristina.

The original proposal also provided an exemption for corn grain, but this benefit was removed from the text. For the senator from Mato Grosso do Sul, the tax loss will be offset by economic gains and the generation of jobs and income, including through corn ethanol, to benefit the energy transition.

Isonomy

Senator Jayme Campos (União-MT) also defended the project, claiming that it is a question of equality between soy and corn. 

“We are allowing, with the exemption from PIS and Cofins, the improvement and economic and social development of various regions of the country and, particularly, of our beloved Mato Grosso and Mato Grosso do Sul”, added the parliamentarian.

The benefits of DDG from corn, which are dried distilled grains used for animal feed, were highlighted by Senator Jaime Bagattoli (PL-RO). He stated that the exemption will alleviate the situation of Brazilian livestock farmers who are currently selling a kilo of meat at half the price charged in the United States.

The comparison with the United States was also made by senator Jorge Seif (PL-SC), mentioning his admiration for the production of corn ethanol in that country.

“They manage to make corn an important input for ethanol, and today we have reached record levels of corn production and generation not only of bran, to feed our livestock, but also of ethanol. So, it is up to me here to recognize the work of these great Brazilians who have always worked and continue to work for agribusiness”, he concluded.

According to the Energy Research Company (EPE), the corn ethanol sector, responsible for the production of bran and oil, grew 804% in the last five years. The Senate Budget Consultancy (Conorf) estimates that, in 2024, tax revenue from biofuel production will increase by R$360 million, while the proposed tax exemption would generate a waiver of R$43 million.