The result of this ruling could cause fund management service providers to include the municipal service tax in their fees.
On 4 May 2021, the Brazilian Superior Court (STJ) held that the municipal service tax (ISS) applies to the income from fund management services provided to a foreign entity because the services are rendered in Brazil and the result of the service is verified in Brazil, even though the foreign entity pays for the services.
Facts
A United States (US) tax resident hired a Brazil…