ICMS/RJ: State Law No. 11,071/2025 increases the Temporary Budget Fund (FOT) rate starting from March 2026

State Law No. 11,071/2025 was published in the State of Rio de Janeiro, changing the rules for contributions to the Temporary Budget Fund (FOT) applicable to companies that benefit from ICMS (Value-Added Tax on Sales and Services) tax incentives in the state. The law takes effect on March 23, 2026.

Until then, the deposit to the FOT corresponded to 10% of the difference between the ICMS calculated with and without the use of the incentive. With the new legislation, this percentage was increased, according to the nature of the tax benefit granted.

For non-onerous tax and financial-tax incentives granted for a fixed term, a gradual increase in the FOT rate was instituted, starting at 20% in 2026 and advancing according to the following schedule:

• 25% starting on January 1, 2027;
• 27% starting on January 1, 2028;
• 30% starting on January 1, 2029;
• 40% starting on January 1, 2030;
• 50% starting on January 1, 2031;
• 60% starting on January 1, 2032.

For fixed-term incentives subject to onerous conditions, a rate of 18.18% applies, to be deposited in the FOT, with no provision for progressive increases. This framework, however, is conditional on proof that the incentive is granted for a fixed term and linked to the fulfillment of onerous conditions under the terms of Article 385 of Complementary Law No. 214/2025.

It should be noted that the form, deadline, and information required for verification will still be regulated by an act of the State Finance Department.

Exceptions to the increase are foreseen for certain sectors, where the tax rate will remain at 10%. Among them, the following are mentioned: manufacturers of additives for lubricants and fuels, taxpayers with special regional tax treatment, processing or industrialization of products for the construction industry, sectors such as the metalworking industry, and wholesale trade.

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Domingues e Pinho Contadores follows tax regulations to provide guidance to its clients and ensure compliance with current rules. To receive this support and ensure tax compliance, please contact us by email: dpc@dpc.com.br.