The CSD would apply to digital advertising services using user data and the sale or transfer of data generated by Brazilian users or collected in Brazil. The aim is to tax revenue derived from the use of Brazilian users’ data.
Brazil’s Chamber of Deputies is reviewing a draft bill to introduce a Digital Social Contribution (Contribuição Social Digital – CSD). The proposed tax would levy 7% on gross revenue of digital service providers earning from specific data-driven activities.
The CSD would apply to digital advertising services using user data and the sale or transfer of data generated by Brazilian users or collected in Brazil. The aim is to tax revenue derived from the use of Brazilian users’ data.
Revenue exemptions would include sales of goods and services on a provider’s own platform, payment services and platforms offering access to financial instruments or securities operations.
The tax would affect providers with global revenue exceeding BRL 500 million, whether based in Brazil or abroad. Revenue allocation for taxation would be proportional: advertising revenue based on ad displays in Brazil and data sales revenue based on the number of Brazilian users relative to total users.
