New law restructures taxation of the recycling chain.
As we anticipated in an analysis published on April 6, 2026, Bill No. 1,800/2021 reconfigured articles 47 and 48 of Law No. 11,196/2005 to restore tax neutrality in the recycling chain.
What changes with Law No. 15.394/2026?
Law No. 15,394/2026, published on April 23, 2026, introduces significant changes to the system of PIS and COFINS taxation on operations involving waste, residues, and trimmings classified under headings 39.15, 47.07, 70.01, 72.04, 74.04, 75.03, 76.02, 78.02, 79.02, 80.02, and 81 of the TIPI (Brazilian Tax Classification of Goods).
The new legislation thus establishes specific treatment for these operations, with direct impacts both on revenues from the sale of materials and on acquisitions made by companies that use them in their production processes.
Exemption on sale and credit on purchase.
From the date this regulation comes into effect, revenues from the sale of these materials will be exempt from PIS/Pasep and COFINS contributions when destined for a legal entity that calculates income tax based on actual profit, and will not be included in the tax base for these contributions. Simultaneously, the acquisition of these items will generate the right to credit for these contributions, provided they are made by a legal entity taxed on actual profit and intended for use as raw materials or secondary materials in the production process.
In this way, the new system seeks to provide greater balance to taxation throughout the recycling chain, preventing the acquisition of these materials from generating a tax burden for the industry that is incompatible with the non-cumulative regime. However, the application of the credit is linked to the destination of the materials in the production process, and companies must observe the conditions stipulated in the legislation.
The impact of the Supreme Court's decision (Topic 304)
The new legal framework substantially alters the treatment previously given to articles 47 and 48 of Law No. 11,196/2005, whose constitutionality was rejected by the Supreme Federal Court in the judgment of RE 607,109/PR (Topic 304), concluded in 2021. On that occasion, the Court declared unconstitutional both the prohibition on crediting and the regime of suspension of incidence on outputs.
The understanding reached by the Supreme Federal Court (STF) made it necessary to adapt the legislation to the premises established by the Court, especially regarding the right to credit for contributions on the acquisition of materials used as inputs in the production process.
Transitional regime until 2026
The effects of the decision were modulated to take effect from March 10, 2026, establishing a transitional regime until the enactment of new legal regulations. During this period, transactions involving waste, residues, and scraps became subject to the regular incidence of PIS and COFINS taxes, with the purchaser being guaranteed the right to appropriate credits under the non-cumulative system.
With the publication of the new law, this transition period is succeeded by specific regulations for the covered operations, bringing greater predictability regarding the applicable tax treatment.
New regime: tax neutrality restored
With the publication of Law No. 15,394/2026, a new legal regime is inaugurated, characterized by a combination of exemption on output and the possibility of credit on input, provided that the acquired goods are used as inputs in the production process. It should be noted that acquisitions intended for resale do not generate credit when not used as raw materials or secondary materials in the production process.
The correct application of the new regime will therefore depend on the analysis of the nature of each transaction and the intended use of the acquired materials, especially for the purposes of calculating and utilizing PIS and COFINS credits.
Given this scenario, companies are required to review their tax procedures and properly configure their systems to accurately reflect the new system for calculating contributions. This review should also consider the tax documents and internal controls used in operations covered by the new legislation.
The Mazzucco&Mello law firm remains available to provide further clarification and assist in implementing the measures necessary to comply with the new regulations.
Article written by: João Rezende, Ricardo Alegransi, Lucas Soares and Henrique Melo.
REFERENCES
https://br-mm.com/tributacao-da-cadeia-de-reciclagem/
https://www.planalto.gov.br/ccivil_03/_Ato2023-2026/2026/Lei/L15394.htm