One of the main doubtful matters in Brazilian tax law is the
levy of Service Tax (ISS) on export of services. The Complementary
Law 116/2003 states that the ISS is not levied on the export of
services to abroad, but it clarifies that the exemption is not
applied to services rendered in Brazil if the outcome is verified
within the country, even if the payment is made from a
foreigner.
Basically, the exemption takes into account three circumstances,
as follows:
a) Country where the service is performed;
b) Country where the outcome is verified; and
c) Country where the payer is located.
Regarding the first circumstance, we may conclude that the ISS is
not levied when the service is performed out of the Brazilian
territory. However, differently from some lectures, I have the
opinion that such circumstance is not based on factual evidences,
but, on the contrary, is determined by the law.
