By Mariana Martins

The Attorney General's Office of the National Treasury, with authorization from the Ministry of Economy, regulated the extraordinary transaction of federal debts registered as active debt accessible to all taxpayers who have debts in this condition. The measure will benefit individuals and legal entities most vulnerable to the crisis situation caused by the coronavirus pandemic.

By means of Ordinance PGFN No. 7,820/2020, it was established that the extraordinary transaction will be carried out only by accession to the proposal of the Attorney General's Office through access to the Regularize program, with the spontaneous proposal of an individual proposal by the debtor taxpayer being prohibited, for the conditions specified.

The extraordinary transaction will involve the down payment in the amount of 1% of the transacted debt, in up to 3 (three) equal and successive installments, with the remaining balance being paid in up to 81 (eighty-one) months for legal entities in general, and in up to 97 (ninety-seven) months for the debtor who is an individual, individual entrepreneur, micro-enterprise or small business. For payment of the first installment, you will be offered 90 (ninety) day grace period, with the first one due to the last day of June 2020.[1]

Adherence to the extraordinary transaction, with regard to debts subject to legal dispute, is subject to presentation, through the Regularize platform, by the end of August 2020, proof of withdrawal of actions, objections and appeals related to the debts transacted, with a request for termination of the action with resolution of merit, in accordance with the Code of Civil Procedure.

If it is in the interest of the debtor taxpayer to include in the extraordinary transaction debts that are already subject to previous installment plans, it is necessary to cancel this installment plan, with the taxpayer being subject to an entry payment of 2% of the remaining debt amount, for subsequent deferral of payment in the manner described above.

Adherence to the extraordinary transaction must be completed by March 25, 2020 and, as mentioned, applies to all taxpayers who have debts registered as active debt., unlike the ordinary transaction regulated at the end of last year by Ordinance PGFN No. 11,956/2019, which established specific conditions for the eligibility of debtors and tradable debts, defined in circumstances totally different from the current ones in terms of market perspective and solvency of individuals and companies.

The Mazzucco & Mello tax team is available to assist you in adopting all necessary practices to ensure that you or your company pays off your debts within the extraordinary criteria established by the Attorney General's Office.

[1] The terms for deferring the aforementioned payment are reduced to 57 (fifty-seven) months in the case of social security contribution debts – employer and employee share (INSS).