With the Tax Reform (Constitutional Amendment No. 132 of 2023), the Federal Constitution now provides for the progressivity of the ITCMD (Inheritance and Gift Tax). In the State of São Paulo, two Bills are currently under discussion to propose replacing the current fixed rate of 4% with progressive rates – Bill No. 7 of 2024 proposes rates ranging from 2% to 8%, while Bill No. 409 of 2025 establishes more moderate rates, between 1% and 4%. Both bills are being discussed by the relevant committees of the São Paulo State Legislature.
If one of the bills is approved in 2025, the implementation of the new rates will depend on compliance with the principles of annuality and the ninety-day rule, meaning that the new rules could come into effect starting in 2026, provided that the 90-day period from the law’s publication is observed. The potential change in ITCMD rates highlights the importance of implementing and reviewing estate and succession planning.
Our tax team has prepared a complete informative on the topic. For more details click here (available only in portuguese).
