Tax News: Streaming - ISS - KPMG | BR
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Tax News: Streaming - ISS

Tax News: Streaming - ISS

Streaming and advertising added to the list of services taxed by the Municipal Service Tax (ISS) in the city of São Paulo


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Tax News: Streaming - ISS

On November 15, 2017, the City of São Paulo published Law 16,757/2017, which, among other changes, added new services to the list of services subject to ISS (Law 13,701/2003), with the aim of aligning it with the recent changes made by Federal Complementary Law 157/2016.

Complementary Law 157, published on December 2016, introduced a number of changes to the levy of Municipal Service Tax (ISS), principally, widening the types of activities / services subject to ISS (as per our Tax News dated January 6th, 2017 – click here).

In this context, Law 16,757/2017 specifically adds a number of activities to the list of services subject to ISS in the Municipality of São Paulo. These include:

  1. “streaming”, that is, the provision of audio, video, image and text content via the internet without any definitive assignment of the content, preserved the immunity granted for books, newspapers and journals (except for the distribution of contents by providers of Conditional Access Services, pursuant Law 12,485 dated September 12, 2011, and subject to ICMS) (item 1.09);
  2. advertising, which consists on inserting texts, images, drawings and other marketing and merchandise contents in any media (except books, newspapers, journals and through broadcasting services and free of charge reception of images and sounds) (item 17.24);
  3. processing, storage or hosting of data, texts, images, videos, electronic pages, applications and information systems, among other formats, and similar (item 1.03); and
  4. development of computer programs, including electronic games, regardless of the constructive architecture of the machine on which the program will run, including tablets, smartphones and the like (item 1.04).

All the services listed above should be subject to ISS at the rate of 2,9%.

Law 16,757 expressly states that the amendments referring to items 1.03 and 1.04 will be in force 90 days after the date of its publication.

However, it is worth noting that there is no express provision determining that the amendments referring to items 1.09 and 17.24 should come into force only 90 days after the publication of the law. Thus, based on the wording of Law 16,757, it seems that the changes to the referred items (1.09 and 17.24) should come into force immediately. Such a provision is subject to discussion, since it seems to infringe the constitutional principle of the 90-day holding period before amendments come into force.

The new São Paulo legislation confirms the tendency of municipalities to apply ISS taxation to activities such as streaming, advertisement, among others.


Companies carrying out streaming and advertising activities should carefully consider the impact of these changes. Specifically, companies should proactively consider the need to register for ISS payment (if any) in the relevant municipality to avoid the potential double taxation of ISS (i.e. in cases where service providers are located in different Municipalities to the recipient).

Click here to access the Portuguese version.

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