Currently, rents are not affected by taxes like other services subject to ICMS (Tax on Circulation of Goods and Services) and ISS (Tax on Services of Any Nature). However, with the tax reform, significant changes may occur.

"For example, concerning the rental of real estate, it is currently not on the ICMS or ISS list. With this reform, a significant tax would be applied to any real estate activity, including construction, development, leasing, leasing, etc. So, the reform consolidates these real estate operations and, for the IVA, technically referred to as the Tax on Goods and Services. Therefore, the government's focus is to organize this aspect before addressing Income Tax," she explains.

One of the primary impacts of the tax reform could be on investments. With taxation on securities in the stock market, the scenario may favor Real Estate Investment Funds (REITs), as no new changes to their rules are currently anticipated.

"Among these rules, the exemption for Real Estate Investment Funds has been maintained. Of course, adjustments were made in the number of participants, but the rest was preserved. So, for example, in a tax reform that burdens dividends more, the tendency is for investors to consider migrating to an investment type that grants exemption, such as real estate," she concludes.

One significant change is related to the collection and maintenance of IPTU (Property Tax). Franco explains that the tax reform would make it easier for municipalities to adjust property tax rates, potentially leading to fairer collections.

"With regards to IPTU, the current understanding is that the reform seeks to meet a demand from municipalities, allowing more flexibility in altering the calculation base compared to the current rigid process," explains the tax lawyer.

Currently, changes to the tax calculation base must go through a legislative process, which is bureaucratic and time-consuming. The tax reform aims to simplify and streamline this process, potentially enabling changes to the calculation base through decrees.

"This would facilitate, including keeping up with property appreciation. Today, we know that the calculation base does not always reflect the real market value. This change could make values more just, but the reform lacks a provision limiting or restricting this executive autonomy. So, there is a risk of having a higher, discretionary calculation base that could end up being exorbitant," she notes.