Brazil ICMS Tax Exemption for Solar (CONFAZ Convênio 16/2015)
Administered by CONFAZ (Conselho Nacional de Política Fazendária) / State Governments
About this program
Under CONFAZ Convênio 16/2015, all Brazilian states exempt the ICMS (state goods and services tax) on the electricity generated and consumed on-site by distributed generation systems. The exemption applies to the energy credits (compensation) between what is injected into the grid and consumed from it, for systems under 1 MW capacity. Initially not all states adhered, but by 2018 all 26 states plus the Federal District had joined. For systems installed before January 2023, full ICMS exemption is grandfathered until 2045. Remote systems or those with consumption at different locations may be subject to ICMS taxation. Brazil's upcoming tax reform (Complementary Law 214/2025) will replace ICMS with new CBS and IBS levies, potentially affecting future treatment.
Eligibility requirements
- Available in all 26 Brazilian states and Federal District
- Must have a distributed generation solar system under 1 MW capacity
- Exemption applies to energy credits consumed at the same location
- Remote systems may be subject to ICMS on transmitted energy
- Pre-January 2023 installations: full exemption grandfathered until 2045
- Post-January 2023 installations: exempt from ICMS but subject to Tarifa Fio B
- Regulated by CONFAZ Convênios 16, 44, 52, 130, and 157 of 2015
- Future changes possible under tax reform (CBS/IBS replacing ICMS)
Official program page
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