The 2nd Panel of the Brazilian Supreme Federal Court (STF) will rule on whether employer social security contributions should apply to the portion of meal and transportation vouchers that is deducted from workers’ salaries. The Panel unanimously decided that the matter has constitutional relevance, as it involves defining what qualifies as “income from work,” a term found in Article 195, Section I, letter “a” of the Federal Constitution, as amended by Constitutional Amendment No. 20/1998 (ARE 1370843).

It is important to note that there is currently jurisprudence from the Superior Court of Justice (STJ) that considers these benefits as part of the calculation base for employer social security contributions, a position consolidated under Theme 1,174. In practice, this means that companies must pay monthly contributions on these amounts, increasing payroll costs. On the other hand, employers argue that such benefits are compensatory in nature, as they are intended solely to ensure transportation and meals necessary for work performance, and therefore do not constitute remuneration for services rendered.

If the 2nd Panel recognizes the compensatory nature of these amounts, it could set an important precedent for the Supreme Court to eventually revisit the current interpretation established by the STJ under Theme 1,174, which deems the taxation of these benefits legitimate — potentially leading to significant impacts for taxpayers.

Furthermore, it is crucial to note that the ruling published by the 2nd Panel does not have General Repercussion status, which currently limits its direct effects. However, even though no date has been set for the judgment, there is an expectation that the issue will gain new dimensions once it is analyzed by the STF.