On September 9, 2025, the Committee on Constitution, Justice, and Citizenship issued its opinion on Complementary Bill No. 108 of 2024, introduced by the Executive. Among other provisions, Book II of the bill addresses the Estate and Gift Transfer Tax (Imposto sobre Transmissão Causa Mortis e Doação – ITCMD). In reviewing the various amendments submitted, the Committee accepted some in full, others in part, while rejecting the remainder.

The bill seeks to address the current lack of a federal framework governing ITCMD by establishing clear and uniform rules at the national level. It amends the National Tax Code to align with these new provisions. At present, in the absence of a general federal law, the States and the Federal District exercise full legislative authority over the tax. With the approval of this bill, however, a federal law will take precedence, setting binding parameters for States and the Federal District, thereby establishing a new legal framework. Existing state and district laws that conflict with the new federal law will be suspended.

The most significant changes introduced to the original text include:

    • the inclusion of definitions for technical terms and concepts to enhance legal certainty;
    • the establishment of general rules for determining tax domicile, with mechanisms to resolve potential conflicts arising from multiple state domiciles; and
    • the explicit clarification that ITCMD applies to the transfer of any assets or rights to which an economic value can be attributed.

The substitute text also incorporates exemptions already recognized under Brazilian jurisprudence, such as:

    • waiver of inheritance or legacy (provided it is unconditional and benefits the estate);
    • benefits derived from private pension plans, insurance policies, savings bonds, or similar contracts;
    • termination of fideicommissum arrangements;
    • transfers to a trust, given the presumption of consideration involved; and
    • transfers from a trust to a beneficiary, when the beneficiary is also the trust’s settlor.

With respect to trusts, the opinion upholds the rule that the taxable event occurs either at the death of the settlor or at the transfer of assets to the beneficiary—whichever happens first. It further maintains that if the settlor irrevocably renounces rights over a portion of the trust’s assets during their lifetime, such renunciation is deemed a “causa mortis” transfer for tax purposes.

For donations, the taxable event is now expressly tied to the moment when real property ownership is formally transferred through registration at the Land Registry, in line with recent Superior Court of Justice (STJ) jurisprudence.

On the matter of tax base calculation, the opinion introduces an important change regarding the transfer of shares or equity interests not traded on stock exchanges or organized over-the-counter markets. While the original text required complex market-based assets and liability valuations (including goodwill), the revised version simplifies this by adopting book value, defined as net equity divided by the number of outstanding shares or equity interests. The Committee found this approach to be less subjective and more practical.

Additionally, the opinion calls for the removal of provisions that sought to tax ITCMD on the transfer of VGBL and PGBL pension plan benefits, in accordance with Supreme Federal Court (STF) precedent. It also eliminates the article that imposed maximum tax rates on holders of large estates, regardless of the donation value.

The bill is scheduled for a vote in the Senate’s Committee on Constitution, Justice, and Citizenship next week. If approved, it will proceed to the Senate Plenary and, subsequently, be returned to the House of Representatives for final consideration. It is indeed a relevant issue which may affect the succession and wealth planning.