Company: SUZ
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001628280-25-020368
Chunk: 62

Company: Suzano S.A.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 62
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5 was enacted, creating the IBS, CBS and IS, and establishing the IBS Management Committee, in line with Constitutional Amendment No. 132. Several aspects of the Tax Reform, including new taxes rates, still shall be regulated through infraconstitutional legislation. A transition period is set from 2026 to 2032, during which both the old and new tax systems will coexist. The broad taxation and the estimated tax percentage may have an impact on our cash flow which may result in an increase in the tax burden and loss of tax benefits from 2032 onwards.

The Brazilian federal government still maintains on its agenda the willingness for (i) revoking the income tax exemption over the distribution of dividends, which, if promulgated, would increase tax expenses associated with any dividends or distributions and (ii) decreasing import tax (which would increase competition and the role of international competitors), both of which could impact on our ability to pay future dividends. Any purported tax reform or change in fiscal policies, if proposed and implemented, may also significantly impact our business. If there is a tax reform or any changes in applicable laws and regulations that alter the applicable taxes or tax incentives/special regimes, either during or after their terms of validity, our business and results may be affected.

Indeed, the Brazilian federal government has frequently implemented, and may continue to implement, changes in its fiscal policies, including, but not limited to, changes to tax rates, fees, sectorial charges and occasionally the collection of temporary contributions. Some of these measures may result in tax hikes that may negatively affect our business. Increases in taxes could also materially adversely impact industry profitability and the prices of our services, restrict our ability to do business in our existing and target markets and cause our financial results to be negatively impacted. If we are unable to pass on the additional costs associated with such fiscal policy changes to our clients through the prices we charge for our services, we may be adversely affected. Uncertainty over whether the acting Brazilian federal government will implement changes in policy or regulation affecting these or other factors in the future may contribute to economic uncertainty in Brazil and to heightened volatility in the securities issued abroad by Brazilian companies.

In October 2021, over 135 jurisdictions agreed on a plan to modernize the international tax system, introducing the Global Anti-Base Erosion Rules. These rules ensure that multinational enterprises with annual revenues of EUR 750 million or more pay a minimum 15% effective tax rate (ETR) in each jurisdiction where they operate. Several jurisdictions have already enacted the