The 1st Section of the Superior Court of Justice postponed the trials of Themes No. 986 and 1125 of the
systematic of Repetitive Resources that involve respectively the exclusion of TUSD and TUST from
calculation basis for ICMS and ICMS-ST of the calculation basis for PIS and COFINS. Both topics were scheduled for judgment on September 13, 2023 and have no scheduled date for return.

Theme No. 986 of Repetitive Appeals refers to the thesis of the exclusion of the System Usage Fee
Distribution (TUSD) and the Transmission System Usage Tariff (TUST) of the ICMS calculation base
incident on electrical energy. The 1st Panel of the STJ has precedents that include the TUSD and the TUST
in the calculation basis of the state tax considering that the tax is levied on the entire process of
supply of electricity. The 2nd Panel of the STJ has precedents in the sense of excluding
tariffs of the ICMS calculation base, on the grounds that the generating fact would occur at the exit of the
electrical energy actually consumed by the supplier establishment. The judgment of the topic by the
STJ will possibly represent the final decision on the matter, since the Supreme Federal Court
recognized, in 2017, that there is no constitutional question on the matter in the judgment of the Theme
No. 957 of General Repercussion.

Regarding this topic, it is worth remembering that Complementary Law No. 194/2022 changed the wording of
article 3, item X, of Complementary Law No. 87/1996, to determine that ICMS does not apply to
transmission services and sectoral charges relating to electricity operations. However, the
Federal Supreme Court, suspended the legal device in the Precautionary Measure in the Direct Action of
Unconstitutionality No. 7,195 in March 2023, resuming the discussion on the topic.

Theme No. 1125 of Repetitive Appeals refers to the exclusion of ICMS due in the system of
tax substitution (ICMS-ST) by the substituted calculation basis of PIS and COFINS. The thesis is
arising from the judgment of Theme No. 69 of General Repercussion by the Supreme Federal Court, which
acknowledged that ICMS does not form the basis for calculating PIS and COFINS, but without specifying whether
ICMS-ST could be excluded. In the judgment of Extraordinary Appeal No. 1,258,842, the Supreme Court
The Federal Court also recognized that the subject of the discussion was infraconstitutional, so that
the STJ will probably give an outcome to the discussion.

The postponement of the trials, which have no scheduled date for resumption, causes yet another
a break in expectations for taxpayers, who were expecting the final judgments of two cases with national repercussions and relevance to occur on the same day. Therefore, it is necessary to wait for the issues to be discussed again, so that both theses have a conclusion.