1E9Ct5D

6.1.6.1. Social Integration Program - PlSThe objective of the PIS contribution is to finance the Unemployment Insurance Program and theAnnual Bonus of one minimum wage. The purpose of unemployment insurance is to providetemporary financial aid to jobless workers, whether dismissed without cause or owing to the partial ortotal stoppage of the employer’s activities.The contribution is payable by companies from the private sector, including financial institutions, withtheir own funds, on the basis of monthly turnover, meaning all the revenue earned by the corporateentity. The type of activity performed by such corporate entity and the accounting classificationadopted for such revenue is irrelevant, and some deductions are permitted. (art. 1 of Law 10,637 of 30December 2002).It is relevant to note that Law 10,637/02 introduced a new PIS calculation mechanism in relation tocorporate entities taxed by actual taxable income. The said Law instituted the rate of 1.65%, butallows companies to deduct from the PIS payable, credits relating to the PIS paid on prior operations,such as: goods purchased for resale; goods and services, used as inputs for the provision of servicesand for the production or manufacture of goods or products intended for sale, including fuels andlubricants; rents of buildings, machinery and equipment, paid to a corporate entity, used for thecompany’s business activity; electric power consumed in the company’s establishments, and othercases (arts. 2 and 3 of Law 10,637/02).Moreover, it is important to mention that the former PIS calculation method, i.e., the application of therate of 0.65%, without the right to the aforementioned credits, is still valid for corporate entities taxedby income tax on the basis of presumed or arbitrated income, tax-immune corporate entities, therevenues derived from the provision of telecommunication and information technology services, andother cases (art. 8 of Law 10,637/02).The PIS contribution is not imposed on income from exports of goods abroad and services rendered toindividuals or companies resident or domiciled abroad, on sales to trading companies with the specificpurpose of exportation (art. 5 of Law 10,637/02 and Law 10,865 of 30 April 2004) and on issues ofgoods destined for the Manaus Free Trade Zone for sale or industrialization (art. 2 of Law 10,996 of15 December 2004).On the other hand, the rate of the PIS contribution is 1.65% upon entry of imported goods andservices (art. 8 “I” of Law 10,865 of 30 April 2004).41