Chemical and petrochemical: the same liter has a different tax rate, license and transport document depending on who buys it and for what
Naphtha that becomes ethylene, solvent that becomes paint and acid that goes to the farm pass through the same tank and leave on very different invoices. The PIS and Cofins rate depends on the plant holding a special regime. The sale depends on a Federal Police license. The load depends on ANTT rules for dangerous goods.
This page gathers what DFSpro read in official sources about the chemical industry special regime, controlled products, dangerous goods transport, ST for the consumer chemicals segments, drawback and the Reform. The tax decision belongs to the client. DFSpro sets up SAP according to the client's decision and shows the result in testing.
What weighs in chemicals and petrochemicals, tax by tax
In the chemical industry the benefit does not belong to the product. It belongs to the qualified company, the buyer and the use: the same molecule is taxed three different ways in the same month.
To start the conversation: does your master data say, product by product, who buys with a reduced PIS and Cofins rate, who buys with ST and who buys for own use?
The short answer: if it does, the month's rate and the ST come out right by buyer. If it does not, the starting point is the matrix of product by buyer and regime, tested on one month of invoices, with the March 2026 change checked.
| Tax | Rule that hits the sector most | Legal basis read | Where it usually breaks (DFSpro's judgment) |
|---|---|---|---|
| PIS and Cofins, special regime (REIQ) | Reduced rates on sales of petrochemical naphtha to petrochemical centers and of listed inputs to chemical plants, plus credit for those who sign a commitment term. Under LC 228/2026: 1.52% and 7% from January 2025 to February 2026, and 0.62% and 2.83% from March to December 2026. | Law 11.196/2005, arts. 56 to 57-D; LC 228/2026; Decree 11.668/2023 | Rate of the previous month after the March 2026 change, and a listed product sold to a buyer that is not a chemical plant. |
| PIS and Cofins on imports in the sector | On the import of naphtha, ethane, propane, butane and the listed inputs by a chemical plant, the PIS and Cofins-Import rates follow the same bands. | Law 10.865/2004, art. 8, § 15 (wording from LC 228/2026, art. 2) | Import entry calculated with the domestic sales table. |
| Single-stage PIS and Cofins on hygiene and perfumery | A producer or importer of products in headings 3303 to 3307 (except 33.06) and codes 3401.11.90 (except Ex 01) and 3401.20.10 pays under Law 10.147, with its own rates. | Law 10.147/2000, art. 1 (consolidated text from Planalto, wording from Law 12.839/2013, read on 22/10/2026) | NCM of a consumer formulation in the master data that does not follow the list. |
| IPI | Charged to the producer by the TIPI table, which follows the NCM. EC 132 cuts the rate to zero in 2027, except for products made under incentives in the Manaus Free Trade Zone. | Decree 11.158/2022 (TIPI); Decree 7.212/2010 (RIPI); EC 132, ADCT art. 126, III | NCM of a formulated product that changes heading when the composition changes. |
| ICMS-ST on consumer chemicals | The segments of cleaning materials, paper and plastics, perfumery and paints and varnishes have their own annex in Agreement 142/18, with NCM and CEST by item. | ICMS Agreement 142/18, Annexes XII, XV, XIX and XXIII | CEST in the master data different from the CEST in the annex, and a state agreement not checked item by item. |
| ICMS on farm inputs | On interstate sales of pesticides and other farm-use products, the tax base is reduced by 60%, with a ban on any use other than the one declared. | ICMS Agreement 100/97, clause one, I | A sale for industrial use classified as farm use. |
| ICMS on transfers between plants and distribution centers | No-tax rule since 01/01/2024 on a sale to an establishment of the same owner, with credit kept and an option for the taxpayer to charge the tax (form and deadline of the option: not checked). DIFAL reaches the final consumer, not the transfer. | LC 204/2023; LC 87, art. 12, §§ 4 and 5; EC 87/2015 | Old setting for taxed transfers still active. |
| Export and drawback | ICMS does not apply to a sale abroad. The input may come in with suspended taxes if it is used in a product that is exported. | LC 87/1996, art. 3, II; Law 11.945/2009, art. 12; Decree 6.759/2009, art. 383 | Input use, loss and by-product that do not close with the concession act. |
| IBS, CBS and Selective Tax | Fertilizers and pesticides get a 60% cut in the IBS and CBS rates (Annex IX). The Selective Tax (IS) reaches mineral goods, but chemicals in general are not listed. | LC 214/2025, arts. 138, 409 and Annex XVII; art. 542 | Current benefit and new regime living side by side, and a farm product with no registration at the Ministry of Agriculture. |
Choose your entry point by your role
Four entries, one for each role, straight to the block that answers your question.
01Tax and fiscal
What the law says on rate, credit and the REIQ commitment term.
Go to section02IT and SAP integrator
Eight setup points that tend to fail in chemicals.
Go to section03Management and decision
When the process becomes a project in the chemical industry.
Go to section04Control and licenses
Federal Police, Army and ANTT: who requires what for the sale and transport of a controlled product.
Go to sectionDirect links
REIQ: what the law says on rate, credit and commitment term
The Chemical Industry Special Regime was read in the consolidated text of Law 11.196/2005 and in LC 228/2026, which changed it on 19/03/2026.
Reduced rates on sales
Art. 56 reduces the PIS and Cofins owed by the producer or importer of petrochemical naphtha on sales to petrochemical centers. The sole paragraph extends the reduction to natural gas and ammonia for certain syntheses and to ethylene, propylene, benzene, toluene and others, when sold by chemical plants to make the listed items.
The 2025 and 2026 bands
Under LC 228, taxable events from January 2025 to February 2026 use 1.52% and 7%. From March to December 2026, 0.62% and 2.83% apply. Values from 2027 on: not checked.
Credit for those who qualify
Arts. 57 and 57-A give credit calculated on the purchase or import of the products in art. 56. Art. 57-C requires a commitment term. Art. 57-D allows an extra credit of 0.5% for PIS and 1% for Cofins from January 2024 to December 2027, in return for a commitment to invest in capacity expansion.
Commitments in the term
Meet occupational safety and health rules, present environmental licenses, keep tax and social security compliance, retire emission certificates and keep the workforce at or above the level of January 1, 2022. LC 228 (art. 57-C, § 5) sets December 1, 2025 as the date to check the workforce requirement for those who qualify for the first time after the LC took effect, published in the DOU of 20/03/2026.
Deadline, cap and loss of the benefit
How to qualify
Decree 11.668/2023 requires filing the term with the Federal Revenue Service through a digital process, with licenses and certificates. The calculation of the credits in arts. 57 and 57-A starts on the filing date. The one in art. 57-D starts on 01/01/2024 if the proposal was approved in 2023, or on the approval date in other cases.
2026 waiver cap
Art. 3 of LC 228 caps the 2026 tax waiver at BRL 2 billion (arts. 56, 57 and 57-A and Law 10.865) and BRL 1.1 billion (art. 57-D). The benefits end in the month after the one in which the Executive demonstrates that the accumulated cost reached the limit.
Breach
A company that breaches the term calculates the credits at the full rates of art. 56 and pays what it left unpaid, with interest and late-payment fine (art. 57-C, §§ 1 and 2).
Effect of LC 224/2025
Art. 4 of LC 224 lists the REIQ among the federal benefits subject to the 10% cut. How this combines with the LC 228 rates and when it starts for each tax: not checked.
The Federal Revenue Service advises that the art. 57-D credit be booked in the EFD-Contributions in record F100, with CST 60, credit base nature 13 and a description in M105 and M505, and that the limit in § 2 of art. 57-D be respected through a negative adjustment in records M110 and M510. Those who booked it another way should correct their filing, under the same guidance.
Art. 542 of LC 214 repeals arts. 55 to 59 of Law 11.196 from 01/01/2027, while art. 57-D speaks of credits until December 2027. How the two dates fit together was not checked in any regulatory act. Until there is such a reading, the 2027 calculation should not be set up as certain.
Federal Police, Army and ANTT: who requires what for the sale and transport
These controls are not tax rules, but they decide whether the invoice can be issued and whether the load can leave. The three rules below were opened in the official source.
Federal Police, Law 10.357/2001
Controls chemicals that could be used to make narcotics or psychotropic drugs. Anyone in a controlled activity registers and applies for an operating license (art. 4), renews the license every year (art. 5), asks for prior authorization to import or export in the cases set by ordinance (art. 7), reports operations periodically and keeps the documents for five years (art. 8).
Which product is included
The law leaves the list of products and concentrations to an ordinance of the Minister of Justice (art. 2). IN DG/PF 338/2026 (art. 1, sole paragraph) says the list is the one in Ordinance MJSP 204/2022. The content of that ordinance and the product list were not read: not checked. Art. 1 says the rule applies in any physical state and regardless of the trade name of the product.
Army, Decree 10.030/2019
Approves the Controlled Products Regulation. A product controlled by the Army is one that has destructive power, may harm people or property, calls for use restrictions for public safety or is of military interest (art. 2). Explosives, initiators and accessories are among them. The classification by type and group is in Annex II, which was not read.
ANTT, dangerous goods by road
ANTT Resolution 5.998/2022, in force as amended, updates the regulation on road transport of dangerous goods and has applied since 01/06/2023. It requires a document with the product information, an Inmetro certificate for bulk, an emergency kit and a driver with a specialized course. Resolution 5.232/2016 appears as repealed on the ANTT page.
IN DG/PF 338/2026: registration, monthly map and fines
Published in the DOU of 03/08/2026, the Federal Police regulation governs control of the products in Ordinance MJSP 204/2022. Text read on 22/10/2026.
Registration, license and map
Anyone in a controlled activity registers and applies for the operating license through SIPROQUIM (art. 5). Control uses a registration certificate, license, special authorization, prior import or export authorization and the Monthly Map (art. 6). The map reports the previous month by the 15th, even with no activity (art. 8, § 1).
Document and concentration
Failing to present an invoice, manifest or other control document when the Federal Police asks is a warning if fixed later (art. 25, III) and a fine if not (art. 27, III). Not stating the concentration of the product in the report, the invoice or the label, with no significant risk to control, is also a warning (art. 25, IV).
Scale of fines
Repeating the warning conduct: BRL 2,128.20 to BRL 20,000.00 (art. 26). Not registering or getting licensed on time: BRL 20,000.01 to BRL 120,000.00 (art. 27, I). Hindering control and inspection (art. 27, IV) and reporting theft, robbery or loss after 48 hours but within five days (art. 27, VII) fall in the same band of BRL 20,000.01 to BRL 120,000.00. From BRL 120,000.01 to BRL 250,000.00 (art. 28) are blocking inspection, not reporting theft, robbery or loss or reporting after five days, changing the product composition with significant impact and not reporting a suspected diversion. Operating without a license or importing without prior authorization: BRL 250,000.01 to BRL 350,000.00 (art. 29).
Effective date and repeals
The rule applies from publication (art. 42) and repeals INs 166/2020 and 211/2021 (art. 41). The fine is set with reasons, with aggravating and mitigating factors and an increase of one third or one half for repeat offenses (arts. 30 to 33). Which of the company's products are on the list: not checked.
What the tax document carries
The shipper answers for the classification
Art. 29 of Resolution 5.998 requires the shipper to demand from the producer correctly classified products and the packing, stowage and handling information. The classification comes from the resolution annex, which was not read.
Document for transport
It can be the operation's own document or another one, as long as it meets the Complementary Instructions (art. 23, II). The rule allows an electronic form when ANTT regulates it.
CT-e and MDF-e
The CT-e (Ajuste SINIEF 09/07) and the MDF-e (Ajuste SINIEF 21/10) are the electronic transport documents. Which dangerous goods fields the layout requires: not checked, because the text of the adjustments read does not give this detail.
Decree 96.044/1988
The old regulation says the product's tax document carries the number and proper shipping name, class and the shipper's declaration (art. 22, II). Whether this text still applies after Resolution 5.998: not checked.
An expired license, a product with no dangerous-goods class in the master data and an incomplete document stop the load at the tax checkpoint, and the tax team only finds out through the delay. Treating the license and the risk class as master data, with a sales block, is a project choice, and the rule on what to block belongs to the company.
ST for consumer chemicals: what Agreement 142/18 lists by segment
Industrial chemicals sold to another industry usually stay outside ST. Consumer chemicals (cleaning, paints, perfumery) come in through an annex of the agreement.
Cleaning materials (Annex XII)
Covers bleach, whiteners and bleaching agents (NCM 2828.90.11 and 2828.90.19, among others), and soaps, disinfectants and sanitizers in powder and similar forms for washing clothes (3401.20.90 and 3808.94.19).
Paints and varnishes (Annex XXIII)
Covers paints and varnishes in headings 3208, 3209 and 3210, "color and similar powders" in packs of up to 1 kg (2821, 3204.17.00, 3206; the official description does not use the word pigments, which is DFSpro's reading of these headings) and colorants for bases, paints and varnishes (3204, 3205, 3206 and 3212).
Paper, plastics and perfumery (Annexes XV and XIX)
Annex XV groups paper, plastics, ceramic products and glass. Annex XIX covers perfumery, personal hygiene and cosmetics. The list of items in each was not read from end to end.
Who adopts it and when
Agreement 142/18 says ST on interstate operations depends on a specific agreement between the states (UFs) (clause two). The protocols of each segment and the states that adopt them: not checked.
Agreement ICMS 142/18, Annex I: the relevant segments here are 11 (cleaning materials), 14 (paper, plastics, ceramic products and glass), 18 (perfumery, personal hygiene and cosmetics) and 22 (paints and varnishes). The last amendment listed on the page is Agreement 107/26.
A supplier that sells the same solvent to a paint plant and to a retail chain makes two operations of a different nature: one of input and one of consumer goods. The type of buyer must be a tax data field in the master data, and the classification decision belongs to the client.
Rules of the sector, with status and source read on 19/10/2026
Each line was opened in the official source. The sources section gives the address of each one.
| Rule | Subject | Status |
|---|---|---|
| Law 11.196/2005, arts. 56 to 57-D | REIQ: reduced PIS and Cofins rates, credit and commitment term | In force, amended (Laws 12.859/2013, 14.183/2021, 14.374/2022, LC 228/2026). Repeal marks on parts of art. 57-A and art. 57-B in the text. LC 214, art. 542, repeals arts. 55 to 59 from 01/01/2027 |
| LC 228, 19/03/2026 | Reduces PIS and Cofins rates for the chemical and petrochemical industry; amends Laws 11.196 and 10.865; 2026 waiver cap | In force on the date of publication (art. 5). Text read in full |
| Decree 11.668, 24/08/2023 | Commitment term and follow-up of the benefits in arts. 56 to 57-D | In force, amended (Decree 11.778/2023, mark in the text). Arts. 1 to 4 read; other articles not read |
| LC 224, 26/12/2025 | Reduces federal tax incentives and benefits; lists the REIQ in art. 4, § 2, II, b | In force. How it combines with LC 228: not checked |
| Law 10.865/2004, art. 8, § 15 | PIS and Cofins on imports of the sector's inputs | In force. Wording read only through LC 228, art. 2 |
| Law 10.147/2000 | Single-stage PIS and Cofins on products in headings 3303 to 3307, with exceptions, and others | In force, with a cross-reference mark to LC 214. Art. 1 read in the consolidated text on 22/10/2026 (except heading 33.06 and 3401.11.90 Ex 01) |
| Decree 11.158/2022 (TIPI) | IPI incidence table | In force, with amendments and an ADI 7153 mark. Only the summary was read; chapters 28 to 39: not checked |
| Decree 7.212/2010 (RIPI) | IPI regulation: taxpayers, taxable event, credit | In force, amended. Read in the manufacturing round |
| ICMS Agreement 142/18 | ST and advance payment; Annexes XII, XV, XIX and XXIII read | In force, amended (last amendment listed: Agr. 107/26) |
| ICMS Agreement 100/97 | Tax base reduced by 60% on interstate sales of farm inputs | In force, amended (last amendment listed: Agr. 79/25). Item II of clause one repealed by Agr. 26/21 |
| LC 87/1996 (Kandir) | ICMS: export (art. 3, II), credit, CIAP | In force, amended. Read in the manufacturing round |
| LC 204/2023 | Amends LC 87: art. 12, § 4 (no taxable event on a sale to an establishment of the same ownership) and § 5 (option of the taxpayer to charge the tax) | In force since 01/01/2024 (art. 3). § 5 enacted on 12/06/2024 after a veto was overridden, according to DFSpro's fact audit; form and deadline of the option: not checked |
| Law 10.357/2001 | Control and inspection of chemicals by the Federal Police | In force, consolidated text read. Ordinance with the product list: not checked |
| IN DG/PF 338/2026, of 29/07/2026 | Inspection and control of the chemicals listed in Ordinance MJSP 204/2022: registration, license, Monthly Map, offenses and fines | In force on publication (DOU 03/08/2026, section 1, p. 25; art. 42). Repeals INs 166/2020 and 211/2021 (art. 41). PDF read on 22/10/2026. List in Ordinance 204/2022: not checked |
| Decree 10.030/2019 | Army Controlled Products Regulation | In force, amended (marks of Decrees 10.627/2021, 11.366/2023 and 11.615/2023 in the text). The decree and arts. 1 and 2 of the regulation were read |
| Decree 96.044/1988 | Regulation on road transport of dangerous goods | Text read on Planalto. Relation to ANTT Resolution 5.998: not checked |
| ANTT Resolution 5.998/2022 | Updates the regulation on road transport of dangerous goods and approves complementary instructions | In force as amended (ANTT mark). In force since 01/06/2023. Amended by Resolution 6.056/2024. Annexes not read |
| ANTT Resolution 5.232/2016 | Complementary instructions for land transport of dangerous goods | Repealed (ANTT mark, by Resolution 5.947/2021) |
| Ajuste SINIEF 07/05 | Creates the NF-e and the DANFE | In force, amended. Header and list of amendments read |
| Ajuste SINIEF 09/07 | Creates the CT-e and the DACTE | In force, amended (last amendment listed: 36/26). Header read |
| Ajuste SINIEF 21/10 | Creates the MDF-e | In force, amended (last amendment listed: 32/26). Header read |
| Law 11.945/2009, art. 12 | Drawback under the suspension mode | In force, amended. Read in the automotive round and checked again here |
| Decree 6.759/2009, art. 383 | Drawback as an export incentive | In force, amended. Art. 383 read |
| LC 214/2025 | IBS, CBS and IS; Annex IX (farm inputs); presumed stock credit (art. 381); natural gas in the IS (art. 423); transition; repeals in art. 542 | In force, amended by LC 227/2026. Arts. 138, 381, 410, 413, 422, 423, 441 and Annex XVII read again on Planalto on 22/10/2026 |
| EC 132/2023 | Consumption reform and transition (ADCT arts. 126 to 128) | In force |
| EFD ICMS/IPI Practical Guide | Layout; the EFD does not calculate CBS, IBS and IS | PDF read on 19/10/2026. Current Practical Guide: check on the SPED portal |
| Federal Revenue Service, EFD-Contributions, REIQ bookkeeping | Guidance on F100, M105, M505, M110 and M510 | Official SPED page read on 19/10/2026. Page publication date: not checked |
Missing from the controls: the Minister of Justice ordinance with the list of controlled chemicals, Annex II of the Controlled Products Regulation, the annexes of ANTT Resolution 5.998 and the dangerous goods layout in the CT-e and the MDF-e.
The ICMS ST protocols of each segment. The TIPI for chapters 28 to 39. The text of Law 14.374/2022. The ordinary law with the IS rates. The EFD-Contributions as a rule, the ECD and the ECF. The state deadlines for EFD and GIA/ST. State ICMS benefit acts for the sector. The SAP baseline for the sector.
The transition to IBS, CBS and Selective Tax in the chemical industry
The dates below were read in EC 132 and LC 214. Later regulation (Decree 12.955/2026) was not read.
2026, a transition year
The test rates are IBS 0.1% and CBS 0.9%, but under art. 348, § 1, of LC 214, those who meet the ancillary obligations are exempt from paying, and § 2 keeps PIS and Cofins in full. Those who do pay offset it or get a refund within 60 days, and Simples Nacional taxpayers are left out (item III, c). The REIQ continues in 2026 with the LC 228 bands, subject to the waiver cap in art. 3.
2027, end of PIS and Cofins and IPI at zero
EC 132 ends PIS and Cofins in 2027 and sets IPI to zero, except for the Manaus Free Trade Zone (ZFM). Art. 542 of LC 214 repeals arts. 55 to 59 of Law 11.196 from 01/01/2027. IBS becomes 0.05% state and 0.05% city in 2027 and 2028, and CBS drops by 0.1 point.
2029 to 2032, ICMS going down
ICMS is worth 9/10, 8/10, 7/10 and 6/10 of the rate set for 2029 to 2032, and state benefits fall in the same proportion (ADCT, art. 128). ICMS no longer exists in 2033.
Fertilizers, pesticides and Selective Tax
Art. 138 of LC 214 cuts IBS and CBS by 60% on the inputs in Annex IX, provided they are registered with the competent body when required, and provides for deferral. The IS applies to mineral goods in Annex XVII. The annex, read on 22/10/2026, lists NCM 2601, 2709.00.10, 2711.11.00 and 2711.21.00 among the mineral goods and has no product from chapters 28 to 39.
Natural gas, stock and Free Trade Zone in LC 214
Natural gas as an input
If natural gas is used as an input in an industrial process and as fuel for transport, the IS rate must be set at zero (art. 423). The buyer declares the use (§ 1). If it is used otherwise, the buyer pays the IS with fine and interest (§ 2). The general rate comes from an ordinary law, which was not read.
How the IS applies
The IS applies once and neither generates nor uses credit (art. 410). Art. 413, II, takes operations with electricity and telecommunications out of the IS. For extracted mineral goods, the rate respects the maximum of 0.25% (art. 422, § 2).
Presumed credit on stock
Art. 381 allows a presumed CBS credit on the stock of January 1, 2027 of goods subject to tax substitution or single-stage taxation (including item I of art. 1 of Law 10.147) and to partial credit restriction. It excludes fixed assets, real estate and items with zero rate, exemption or suspension. Credit of 9.25% on stock bought in the country, taken up to June 2027 and used in 12 installments, only to offset CBS. The Executive act on stock verification: not checked.
Manaus Free Trade Zone
Art. 441 leaves out of the Manaus Free Trade Zone favored regime fuels derived from oil (with an exception for refining in the zone itself) and perfumery, toiletries and cosmetics, except headings 3303 to 3307 in restricted cases. The client decides how to classify the product.
In the EFD practical guide, the bookkeeping is not used to calculate CBS, IBS and IS, and the amount of these taxes goes into the document total, not into the analytical records (except in 2026, according to the guide).
For the chemical industry the critical point of 2027 is the benefit that depends on qualification and on a cap. Without a clear transition rule, the risk is calculating credit that the law has already repealed. Keeping, changing or giving up the benefit is the client's choice.
What DFSpro solves in the chemical and petrochemical industry
Six points where the rate, the control or the inventory need ready data in SAP, and what DFSpro delivers in each.
Two rate bands in the same year
In 2026, the REIQ PIS and Cofins rates went from 1.52% and 7% to 0.62% and 2.83% from March (LC 228/2026, art. 56, IX and X). The February invoice and the March invoice follow different rules. DFSpro loads the bands by taxable event and tests the change with the client's invoices.
The Monthly Map on the 15th
IN DG/PF 338/2026 requires the Monthly Map of controlled products by the 15th day of the following month, even with no activity (art. 8, § 1). DFSpro designs the extraction of the movement from SAP and the calendar, so the deadline does not depend on memory.
Controlled product and license before the sale
The same regulation sets a fine of BRL 20,000.01 to BRL 120,000.00 for failing to register or get licensed (arts. 25 to 27). DFSpro brings the control flag and the license validity into the master data, so SAP warns before the sale.
By-product with a process order
Process petrochemicals generate by-products, and the EFD asks for joint production records. DFSpro links bill of materials, yield and process order to Bloco K and tests by order.
The stock of December 31, 2026
LC 214 allows a presumed CBS credit on stock of single-stage items, items with ST or items coming from the cumulative regime, under conditions (art. 381). Whoever classifies the inventory item by item reaches the decision with the data ready. DFSpro prepares the list; the decision belongs to the client.
The Annex IX item is not an ordinary chemical
Art. 138 of LC 214 cuts IBS and CBS by 60% on the Annex IX items, with registration at MAPA when required. DFSpro records the MAPA classification in the master data next to the NCM and tests the scenario. The classification belongs to the client.
Sources: LC 228/2026, LC 214/2025 (Planalto) and IN DG/PF 338/2026.
What the chemical industry files and who requires it
To check the layout, deadline and basis of each return in the sector, see ancillary obligations and SPED in SAP, in EFD ICMS/IPI and in the SPED legislation. The dates for each month are in the tax calendar.
| Obligation | What it reports | Frequency and requirement |
|---|---|---|
| EFD ICMS/IPI | ICMS and IPI bookkeeping, inventory, CIAP and production. | Monthly. Mandatory for ICMS and IPI taxpayers under Ajuste SINIEF 02/09. The deadline comes from state legislation (EFD practical guide). |
| Bloco K | Production, input use, losses and booked stock. | Monthly, inside the EFD, under clause three, § 7, of Ajuste SINIEF 02/09. The Practical Guide layout has its own records for joint production (K290 order, K291 items produced, K292 inputs consumed) and K260 for reprocessing (PDF read on 19/10/2026; current version: check on the SPED portal). Who is required, by size and CNAE: not checked. |
| EFD-Contributions | PIS and Cofins, including the REIQ credit in F100 and in Block M. | Federal Revenue guidance on the REIQ read. Frequency and requirement as a rule: not checked. |
| REIQ commitment term | Qualification for the credits in arts. 57, 57-A and 57-D and follow-up of the tax cost by product. | Filing with the Federal Revenue Service through a digital process (Decree 11.668/2023, art. 4). Follow-up deadlines: not checked. |
| NF-e, model 55 | Document of each operation, with NCM, CEST, buyer and use. | Ajuste SINIEF 07/05. Specific fields for controlled or dangerous products: not checked. |
| CT-e and MDF-e | Freight transport and the vehicle manifest. | Ajustes SINIEF 09/07 and 21/10. Requirement for dangerous goods data: not checked. |
| GIA/ST and DeSTDA | ST withheld and paid to the destination state (UF) in the consumer chemicals segments. | Under Agreement 142/18. Frequency: not checked. |
| Federal Police license and maps | Operating license, annual renewal and periodic reports on operations with controlled products. | Law 10.357/2001, arts. 4, 5 and 8. IN DG/PF 338/2026 sets the Monthly Control Map in SIPROQUIM by the 15th of the following month, even with no activity (art. 8, § 1; text read on 22/10/2026). |
| Army records | Registration and inspection of the controlled product by the Army Command. | Decree 10.030/2019. Procedure by type of product: not checked. |
| Dangerous goods transport documents | Transport document, Inmetro certificates for bulk and emergency sheet. | ANTT Resolution 5.998/2022, art. 23. Electronic when ANTT regulates it (art. 23, § 2). |
| Drawback concession act | Proof that the input was used in the exported product. | Law 11.945, art. 12. System, deadline and proof: not checked. |
| ECD and ECF | Accounting and tax bookkeeping. | Not checked: rules not read in this round. |
Eight setup points that tend to fail in chemicals
DFSpro's judgment, not a measurement: these are the setup gaps we most associate with the chemical industry. Each point shows how it appears in the tax data and the test that solves it. The SAP baseline for the sector was not checked.
Qualification as company data
Judgment: REIQ qualification applies by company and establishment and changes the PIS and Cofins rate and the credit. Symptom: a sale calculated with the wrong table. Proof: reprocess one month of invoices against the band in force.
Rate by month
Judgment: LC 228 changed the band in March 2026. Symptom: March invoices with the old band. Proof: validity table by taxable event date and a sample of invoices before and after the change.
Product list and buyer
Judgment: the benefit depends on the product being on the list and on the buyer being a chemical plant that uses it as an input. Symptom: a sale to a distributor treated as a sale to a plant. Proof: report of invoices by NCM and type of buyer.
Extra credit under art. 57-D
Judgment: it requires F100, CST 60, nature 13 and a negative adjustment in records M110 and M510. Symptom: credit with no description or without the limit adjustment. Proof: EFD-Contributions checked against the Federal Revenue guidance.
Waiver cap
Judgment: the benefit ends in the month after the cap is used up. Symptom: the system keeps calculating the benefit after it ended. Proof: validity switch by period and a monthly review routine of the rule.
License and risk class in the master data
Judgment: the Federal Police license expires every year and the risk class defines the transport. Symptom: a sale released with an expired license or a load without dangerous goods data. Proof: report of controlled materials and license validity.
NCM and CEST of formulations
Judgment: paints, cleaning and perfumery have their own annex in ST, and the composition changes the heading. Symptom: ST withheld too low or a rejection. Proof: master data checked against the annexes of Agreement 142/18.
Drawback and mass balance
Judgment: process losses and by-products must close with the concession act and with Bloco K. Symptom: a drawback balance that does not close. Proof: consumption by production order compared with what was recorded.
When the process becomes a project
In these 19 points of chemical and petrochemical operations, the work in SAP stops being routine and calls for design, setup and proof. In each one, the tax decision remains the client's.
Planned shutdown with component replacement
What weighs. Reactor, column and exchanger stop together and the spending must be split between expense, asset cost and part replacement.
What changes. DFSpro traces each shutdown order to the asset and proves the partial write-off of the replaced component.
See situation, legal basis and proof
A plant shutdown mixes maintenance, improvement and replacement of a component with its own useful life. In SAP, each cost goes through an order or project, assets under construction and settlement to the final asset.
Legal basis. Decree 9.580/2018 (RIR), arts. 317 and 320, and CPC 27 Property, Plant and Equipment. Where to capitalize is the client's decision.
Proof delivered. Scenario matrix (expense, capitalization, replacement) with accounting document and balance by depreciation area.
Accounting and tax depreciation side by side
What weighs. Accounting uses the economic useful life of the plant; tax uses its own rate and, at times, accelerated depreciation.
What changes. DFSpro compares the depreciation areas asset by asset and proves the difference that goes to tax control.
See situation, legal basis and proof
Each asset runs in parallel depreciation areas, and the difference between them must be a traceable exclusion or addition in the Lalur and the ECF, asset by asset.
Legal basis. RIR/2018, arts. 320, 321 and 324 (rate by period of use, excludable difference, incentivized accelerated depreciation). The validity of a benefit for the client is confirmed case by case.
Proof delivered. Reconciliation report by asset between the two areas, closing with the ledger and with the tax control balance.
CIAP and the 48 installments of the asset
What weighs. A new plant and a capitalized shutdown create monthly installments, with a share of taxed sales that changes every month.
What changes. DFSpro links asset, invoice and installment, and tests the month with a sale or an asset write-off.
See situation, legal basis and proof
The credit is taken at 1/48 per month, adjusted by the ratio of taxed sales (export included) to total sales. A sale, loss or write-off changes the balance of installments.
Legal basis. Complementary Law 87/1996, art. 20, § 5, items I and II. Taking the credit is the client's decision.
Proof delivered. Installment ledger by asset checked against the month's bookkeeping, with the write-off scenarios tested.
PIS and Cofins credit on depreciation
What weighs. The monthly credit depends on the asset falling within the legal cases, and each asset must carry that classification.
What changes. DFSpro maps asset by credit case and proves the monthly calculation, including the move to CBS.
See situation, legal basis and proof
The depreciation charge incurred in the month creates credit only for assets in the legal cases. LC 214 requires keeping the depreciation credit as a presumed CBS credit.
Legal basis. Law 10.637/2002, art. 3, § 1, III; LC 214/2025, art. 380.
Proof delivered. List of asset, charge for the month and credit, checked against the tax calculation ledger.
Change of useful life and impairment
What weighs. The plant shuts down a line or reviews the useful life, and the charge changes midway.
What changes. DFSpro proves, on a test asset, the new charge in both areas and the document generated.
See situation, legal basis and proof
The company must periodically analyze the recoverability of fixed assets and review the useful life criteria. Each adjustment changes the corporate charge and leaves a reflection in tax control.
Legal basis. Law 11.638/2007, which changed art. 183, § 3, of Law 6.404/1976; RIR/2018, art. 321.
Proof delivered. Asset with changed useful life: charge before and after, in both areas, with date and accounting document.
ICMS credit balance from exports
What weighs. The exporter sells without tax and builds up credit by establishment, with no clear trail of its origin.
What changes. DFSpro rebuilds the balance by establishment and by month, with the origin of each credit.
See situation, legal basis and proof
Whoever exports builds up a credit balance. The law provides for offsetting the balance against another establishment in the state or, for the rest, transferring it to third parties with a document that recognizes the credit.
Legal basis. Complementary Law 87/1996, art. 25, § 1, items I and II. The client confirms each state's rules with its tax authority.
Proof delivered. Balance ledger by establishment and month, closing with the EFD ICMS/IPI calculation.
Loss and evaporation in a tank
What weighs. The product disappears in the process, and the inventory must say what is normal loss and what requires credit reversal.
What changes. DFSpro separates the loss movements by type and proves the reversal or the keeping of the credit.
See situation, legal basis and proof
The law requires reversing the credit of goods that perish, deteriorate or are lost. In the plant, the loss inherent to the process and the extraordinary loss need separate accounts and justifications.
Legal basis. Complementary Law 87/1996, art. 21, IV. Qualifying the loss is the client's decision.
Proof delivered. Monthly loss report by type, with the credit treatment at both ends.
Drawback: imported the input, exported the product
What weighs. The suspension on import only holds if each imported item closes against the exported item.
What changes. DFSpro designs the flow of import, production order and export, and proves the closing by item.
See situation, legal basis and proof
The drawback regime suspends taxes on the import of an input that will be exported after processing. The control links the item bought, the consumption in the order and the sale abroad.
Legal basis. Customs Regulation (Decree 6.759/2009), art. 383. The client confirms current deadlines and write-offs in the concession act.
Proof delivered. Report by item that closes the imported against the exported under the concession act.
ICMS benefit and offset until 2032
What weighs. The transition gradually reduces the onerous benefit, and the calculation needs operation by operation.
What changes. DFSpro isolates the benefited operations in SAP and proves the calculation of the benefit for each year.
See situation, legal basis and proof
Holders of an onerous ICMS benefit granted up to 31/05/2023 may be offset by a fund between 2029 and 2032. This calls for calculating the level of the benefit and proving the requirements.
Legal basis. Complementary Law 214/2025, art. 384 (wording from LC 227/2026). Qualifying is the client's decision.
Proof delivered. Annual report of the benefited operations, with amounts, closing with the tax calculation.
Inventory of December 31, 2026
What weighs. Stock with a different credit history, item by item, before the year ends.
What changes. DFSpro prepares the list by item and case, ready for the client to decide.
See situation, legal basis and proof
The presumed CBS credit on the stock of January 1, 2027 depends on the regime in 2026 and on the treatment at purchase. Classifying thousands of items in December is where the deadline gets tight.
Legal basis. Complementary Law 214/2025, art. 381. Taking the credit is the client's decision.
Proof delivered. Stock list by item and case, closing with the accounting inventory.
CBS and IBS: input credit with suspension
What weighs. A purchase invoice with suspension or deferral does not create the same credit as an ordinary invoice.
What changes. DFSpro builds the treatment matrix by invoice and proves the resulting credit in each scenario.
See situation, legal basis and proof
The credit arises when the debit of the earlier operation is settled, and operations with exemption, zero rate, deferral or suspension do not give the buyer credit.
Legal basis. Complementary Law 214/2025, arts. 47 and 49.
Proof delivered. Scenario matrix by treatment, with the credit calculated on each line.
ECC to S/4HANA with fixed assets intact
What weighs. Thousands of assets, several depreciation areas and CIAP in progress must reach S/4 with no difference.
What changes. DFSpro reconciles asset by asset, before and after the conversion, by depreciation area.
See situation, legal basis and proof
Standard ECC maintenance ends in December 2027, and SAP offers a paid extension until December 2030. The opening balance of each asset must close with the legacy system.
Legal basis. SAP News, October 2026 (maintenance dates).
Proof delivered. Reconciliation by asset and by area, before and after, validated by the client's accounting team.
REIQ: a rate that changes by month and a benefit with a cap
What weighs. In 2026 the PIS and Cofins rates on sales of chain inputs change in March, and the law caps the waiver for the year.
What changes. Rate table by taxable event date and a test with invoices in the month of the change.
See situation, legal basis and proof
LC 228/2026 sets the rates of 1.52% and 7% for taxable events from January 2025 to February 2026, and 0.62% and 2.83% for March to December 2026. The same law caps the waiver of the regime in 2026 and requires the benefits to end from the month after the one in which the Executive demonstrates that the accumulated cost reached the limit. The act that recognizes the limit must be followed.
Legal basis. LC 228/2026, arts. 1 and 3; Law 11.196/2005, art. 56.
Proof delivered. Sales scenario in February and in March 2026 with the right rate, and the tax calculation checked against the table in the law.
Import of naphtha, ethane and propane: rate by taxable event
What weighs. Importing petrochemical feedstock has its own PIS and Cofins-Import rate, which also changed in March 2026.
What changes. Rate set by date and by material, with reconciliation between the import declaration and the tax calculation.
See situation, legal basis and proof
LC 228/2026 covers the import, by chemical plants, of ethane, propane and butane for ethylene and propylene, of petrochemical naphtha and condensate for petrochemical centers, and of other listed inputs. The PIS and Cofins-Import rates are the same as in each period: 1.52% and 7% until February 2026, and 0.62% and 2.83% from March to December 2026.
Legal basis. LC 228/2026, art. 2, which gives new wording to § 15 of art. 8 of Law 10.865/2004.
Proof delivered. Import scenario in February and in March 2026, by material, with the right rate and the amount reconciled.
Anti-dumping duty on imported resin
What weighs. The duty is an amount per ton that varies by country of origin and by producer or exporter, and it has a term.
What changes. Duty table by NCM, origin and exporter linked to the supplier and material master data.
See situation, legal basis and proof
Camex Resolution 876, of April 13, 2026, applied a definitive anti-dumping duty, for up to five years, on imports of polyethylene resins from Canada and the United States, for NCMs 3901.10.30, 3901.20.29 and 3901.40.00, with the amounts in dollars per ton set by origin and by producer or exporter. The resolution changed the amounts for public-interest reasons.
Legal basis. Camex Resolution 876/2026, published in the DOU of 14/4/2026, and the MDIC page on measures in force.
Proof delivered. Import scenario by origin and exporter, with the duty calculated and checked against the resolution table.
Concept of input: essentiality and relevance, item by item
What weighs. The PIS and Cofins credit on materials and services in the process depends on each item passing the essentiality or relevance test.
What changes. Each material and service classified by function in the process, with the reason kept in the master data.
See situation, legal basis and proof
In 2018 the STJ ruled that the concept of input is measured by the criteria of essentiality or relevance, considering how indispensable or important the item is to the activity, and declared the rules of SRF Normative Instructions 247/2002 and 404/2004 unlawful. The analysis is case by case and depends on proof. In a plant with thousands of materials, the reason must be tied to the item.
Legal basis. STJ, REsp 1.221.170/PR, Theme 779 of repetitive appeals, First Section.
Proof delivered. Matrix of item by function in the process and by treatment, with the reason attached and the tax calculation checked.
Pesticides and fertilizers: 60% cut in the reform, with registration
What weighs. The cut only applies to the products in the annex and, when required, to those registered with the competent farm body.
What changes. Material master data with NCM, registration and treatment, with a block when the registration is missing.
See situation, legal basis and proof
LC 214/2025 cuts the IBS and CBS rates by sixty percent on the supply of the farm and aquaculture inputs in Annex IX, which includes fertilizers, soil correctives and pesticides by NCM. The cut only applies to a product that, when required, is registered as a farm or aquaculture input at the Ministry of Agriculture and Livestock. Payment is deferred in operations between taxpayers in the regular regime.
Legal basis. LC 214/2025, art. 138, caput, §§ 1 and 2, and Annex IX.
Proof delivered. Matrix of product by registration and by rate, with a scenario of a product with no registration and a check against the tax document.
Reduced ICMS base on pesticides, with a term until 2027
What weighs. The benefit has a validity term and a condition on use, and the credit rule changed in 2022.
What changes. Benefit set up with validity and use, and a credit reversal test.
See situation, legal basis and proof
ICMS Agreement 100/97 reduces the ICMS tax base by sixty percent on interstate sales of insecticides, fungicides, herbicides and other listed products made for use in farming and livestock, and bars the benefit when the product is put to another use. The agreement runs until December 31, 2027 and lets the states require the seller to deduct the waived tax from the price, with the deduction shown on the invoice. The authorization not to require credit reversal was repealed with effect from January 1, 2022.
Legal basis. ICMS Agreement 100/97, clauses one, five and seven (wording from ICMS Agreement 26/21 and ICMS Agreement 79/25).
Proof delivered. Interstate sale scenario with and without farm use, with the base, the credit and the deduction on the invoice.
Naphtha for a petrochemical center: IBS and CBS suspension
What weighs. The suspension depends on conditions that can be checked in the operation, such as an authorized buyer and use as an input.
What changes. Buyer master data with the authorization and the destination of the material, with a test of suspension and of loss of the benefit.
See situation, legal basis and proof
LC 214/2025, as worded by LC 227/2026, requires a joint act of the Federal Revenue Service and the IBS Steering Committee to set the cases of IBS and CBS suspension on operations with liquid hydrocarbons derived from oil that are not fuels, or from natural gas, including naphtha, when the buyers are petrochemical centers authorized by the ANP, the material is used as an input and the conditions of the act are met. The joint act must be read once published.
Legal basis. LC 214/2025, art. 172, § 2, added by LC 227/2026.
Proof delivered. Matrix of operation by buyer, authorization and destination of the material, with the right treatment on each line.
Which of these situations is yours? Start with the Tax Diagnostic.
Diagnostic, AMS Fiscal and GUEPARDO Tax in chemicals
Tax diagnostic
Maps the setup of PIS and Cofins, ICMS, ST, IPI, drawback and credit at each plant and distribution center, compares it with the rule read and ranks by risk: critical, high, medium or monitor.
Project and AMS Fiscal
Sets up in SAP the classification the client chose by product and buyer and tests the result. In AMS Fiscal, it follows the changes in rate, agreement and annex through the year, such as the change of REIQ band.
GUEPARDO Tax
DFSpro licenses GUEPARDO Tax, from NTT DATA, as an Authorized Channel, and also implements it and answers for governance. In chemicals, the classification the client chose by product and buyer is tested there before it becomes routine.
To read more
Related blog articles
- PIS and Cofins credit kept in law and the bookkeeping in SPED
- From the PIS and Cofins credit balance to the CBS credit
- All articles by topic
The tax decision belongs to the client: for example, whether to apply for the REIQ, how to treat the art. 57-D credit or which thesis to take in each state. In chemicals, DFSpro sets up the choice and proves, product by product, that the calculation comes out as the client decided.
Official sources read, last checked on 19/10/2026
Text opened and checked on that date; IN DG/PF 338/2026 and the LC 214 articles cited in the new blocks were read again on 22/10/2026. Any ordinance, protocol or state act that the operation uses and that is not listed here remains unread.
Constitution and laws (Planalto)
- Constitutional Amendment 132/2023Planalto
- Law 11.196/2005Planalto
- Complementary Law 228/2026Planalto
- Complementary Law 224/2025Planalto
- Complementary Law 214/2025Planalto
- Complementary Law 204/2023Planalto
- Complementary Law 87/1996Planalto
- Law 10.147/2000Planalto
- Law 10.357/2001Planalto
- Law 11.945/2009Planalto
- Decree 11.668/2023Planalto
- Decree 10.030/2019Planalto
- Decree 96.044/1988Planalto
- Decree 6.759/2009 (Customs Regulation)Planalto
- Decree 11.158/2022 (TIPI)Planalto
CONFAZ
Questions from the chemical industry tax director on REIQ, licenses and dangerous cargo
01What is the REIQ and who is entitled to it?+
It is the Chemical Industry Special Regime, in arts. 56 to 57-D of Law 11.196/2005. It gives reduced PIS and Cofins rates on sales of petrochemical naphtha and listed inputs, and credit to petrochemical centers and chemical plants that sign a commitment term. Who is entitled is the client's own analysis of its classification.
02What is the REIQ PIS and Cofins rate in 2026?+
Under LC 228, 1.52% and 7% for taxable events from January 2025 to February 2026, and 0.62% and 2.83% from March to December 2026. For 2027, LC 214 repeals arts. 55 to 59 of Law 11.196, and the exact reading of that date was not checked.
03Can the benefit end before December 2026?+
Yes, under art. 3 of LC 228. The 2026 waiver has a cap of BRL 2 billion (arts. 56, 57, 57-A and Law 10.865) and BRL 1.1 billion (art. 57-D), and the benefit ends in the month after the one in which the Executive demonstrates that the accumulated cost reached the limit.
04How does the extra credit under art. 57-D go into the EFD-Contributions?+
The Federal Revenue Service advises record F100 with CST 60, rates of 0.5% and 1%, credit base nature 13 and a description in M105 and M505, with a negative adjustment in M110 and M510 to respect the limit in § 2. Those who did it another way should correct their filing.
05Does LC 224 cut the REIQ by 10%?+
Art. 4, § 2, II, b, of LC 224 includes the REIQ among the federal benefits subject to the 10% cut. How this cut combines with the LC 228 rates and when it starts for each tax was not checked. Confirm with your tax advisor before changing any calculation.
06Do I need a Federal Police license to sell a chemical product?+
If the product is on the list in the Minister of Justice ordinance, yes: Law 10.357 requires registration, an operating license (art. 4) and annual renewal (art. 5). The current list was not read for this page, so the answer for each product depends on checking the ordinance.
07Which chemical product does the Army control?+
The Controlled Products Regulation (Decree 10.030/2019) treats as controlled a product that has destructive power, may harm people or property, requires use restrictions for public safety or is of military interest. The classification by type and group is in an annex that was not read.
08Which ANTT rule applies today to dangerous cargo by road?+
ANTT Resolution 5.998/2022, in force as amended (ANTT marks Resolution 6.056/2024 among them), in force since 01/06/2023. Resolution 5.232/2016 is listed as repealed. Decree 96.044/1988 still appears on Planalto with no repeal mark, and the relation between the two was not checked.
09Do the CT-e and the MDF-e have a field for dangerous goods?+
The adjustments read create the documents, but the text does not detail dangerous goods fields. That detail is in the layout manuals, which were not read. So there is no statement here about which fields are mandatory.
10Does transferring product between my plants pay ICMS?+
Since 01/01/2024, the rule is no incidence (LC 204/2023, art. 12, § 4 of LC 87), with credit kept and an option for the taxpayer to charge the tax (§ 5, enacted on 12/06/2024). Form and deadline of the option: not checked. DIFAL, under EC 87 and LC 190, covers the final consumer and entry for own use, consumption or assets.
11Do paint, cleaning products and perfumery have ST?+
Agreement 142/18 has annexes for these segments (XII, XIX and XXIII), with NCM and CEST. But ST on interstate operations depends on a specific agreement between the states, and the protocols of each segment were not read. Check the state of origin and of destination before assuming withholding.
12Do fertilizer and pesticide keep a benefit in the Reform?+
Art. 138 of LC 214 cuts IBS and CBS by 60% on the Annex IX inputs, which include chapter 31 fertilizers and products in heading 38.08, provided they are registered with the competent body when required. The item-by-item list was not checked.
13What is the fine if the company does not register with the Federal Police?+
Under IN DG/PF 338/2026, failing to register or get licensed within the legal deadline is punished with a fine of BRL 20,000.01 to BRL 120,000.00 (art. 27, I). Carrying on a controlled activity without the operating license or special authorization raises the band to BRL 250,000.01 to BRL 350,000.00 (art. 29, I). The amount is set with reasons, with aggravating and mitigating factors (arts. 30 to 33). Whether the company's product is on the list in Ordinance 204/2022: not checked.
14Does the Federal Police Monthly Map also apply to a month with no sales?+
Yes. IN DG/PF 338/2026 requires reporting in SIPROQUIM, by the 15th of the following month, the activities of the previous month with a controlled product, even with no activity (art. 8, § 1). A map filled in with wrong information can be corrected, without removing liability if the correction comes after an inspection (art. 8, § 2).
15Does natural gas used as an input pay the Selective Tax?+
Art. 423 of LC 214 requires setting the IS rate at zero for natural gas used as an input in an industrial process and as fuel for transport, with a declaration from the buyer. If the gas has another use, the buyer pays the IS with fine and interest. The general rate depends on an ordinary law, which was not read. Applying the rule to the case is the client's decision.
16I have stock on 31/12/2026. Can I take CBS credit?+
Art. 381 of LC 214 provides for a presumed CBS credit on the stock of January 1, 2027 in three cases, among them goods with ST or single-stage at purchase and the share with partial credit restriction. The rate is 9.25% on stock bought in the country, taken up to June 2027. Whether the item qualifies and whether it is worth taking is the client's decision; the Executive act on the inventory was not read.
17What material should the chemical industry bring to the first meeting?+
The plants and distribution centers, the products that go to industry and those that go to consumers, the REIQ qualification or the Federal Police license, if any, the latest PIS, Cofins or ST mismatch and the SAP version. With that, the first cut of the work comes out of the meeting itself.
Bring the products, the buyers and the PIS, Cofins or ST mismatch that worries you most
Tell us what the plant makes, who buys each product and what qualification or license the company holds. That account sets the first cut of the work.
Support material for the meeting: the page on tax diagnostic in SAP and the one on system adaptation to CBS and IBS.