Law No. 14,260/2021 - establishes incentives for the recycling industry

Country / jurisdiction: Brazil · Year: 2021 · Status: In force · Level: National · Type: Voluntary

Federal Law No. 14,260/2021 establishes tax incentives and benefits for projects that stimulate the recycling production chain, with a view to encourage the use of raw materials and inputs made from recyclable and recycled materials (in accordance with Art. 44 of Law No. 12,305 of 2010).

In terms of the law, within 5 years of its promulgation, individuals and legal entities taxed based on actual profit would be able to deduct a part of their income tax due to direct support for projects previously approved by the Ministry of the Environment aimed at:

training, education, and technical assistance, including the promotion of national and international exchanges for educational/academic use, business, community associations, and social organizations explicitly focused on promoting, developing, implementing, or fostering recycling or reuse activities;

incubation of micro-enterprises, small businesses, cooperatives, and solidarity social enterprises engaged in recycling activities;

research and studies to support actions involving shared responsibility for product lifecycles;

implementation and adaptation of physical infrastructure for micro-enterprises, small businesses, industries, cooperatives and associations of collectors of reusable and recyclable materials;

acquisition of equipment and vehicles for the selective collection, reuse, processing, treatment, and recycling of materials by industries, micro-enterprises, small businesses, cooperatives and associations of collectors of reusable and recyclable materials;

the organization of marketing networks and production chains, and support for these networks, integrated by micro-enterprises, small businesses, cooperatives and associations of collectors of reusable and recyclable materials;

strengthening the participation of collectors of reusable and recyclable materials in recycling chains; and

the development of new technologies to add value to the collection of reusable and recyclable materials.

The law also authorised the creation of the Investment Funds for Recycling Projects (ProRecicle) for funding resources to the above-stated projects, and established the National Commission for the Promotion of Recycling (CNIR) for the purpose of issuing relevant guidelines.

In addition, on July 10, 2024, Federal Decree No. 12,106/2024 was issued to regulate the tax incentives for the recycling production chain established under Federal Law No. 14,260/2021.

Official source: https://www.planalto.gov.br/ccivil_03/_ato2019-2022/2021/lei/l14260.htm#promulgacao