Internationalization in the Fabric Processing Industry: A Comparison between Presumed Profit and Actual profit

Luciana Assolari Vichesi; Raissa Alvares de Matos Miranda

DOI: 10.22167/2675-6528-202603178

Article derived from a Course Conclusion Work (TCC), with content based on the student’s original work and adapted to the editorial format of the E&S Magazine with the support of the ResumeAI tool, an artificial intelligence solution developed by Instituto Pecege for textual synthesis and organization.

Summary

This study analyzed the tax impacts of internationalization in a Brazilian textile processing industry, comparing the Presumed Profit and Real Profit regimes and their effects on business competitiveness. The research, of an applied nature and qualitative approach, used a case study based on the analysis of the organization’s economic, fiscal, and operational data for the fiscal year 2025. Tax incentives applicable to exports were examined, such as the exemption of Tax on Industrialized Products (IPI), ICMS, PIS, and COFINS, and the possibility of maintaining tax credits. Comparative scenarios were developed between the regimes, considering the effective tax burden, pricing, cash flow, administrative complexity, and economic viability. The results showed that export operations provided a significant reduction in the indirect tax burden and the maintenance of credits, improving competitiveness. However, the simulations indicated that, even with the utilization of PIS and COFINS credits under the Real Profit regime, the overall tax burden calculated was higher than that of the Presumed Profit regime, resulting in a lower net profit. It was concluded that remaining in the Presumed Profit regime proved more advantageous for the company in the analyzed scenario, and that taxation plays a strategic role in competitiveness, providing subsidies for decision-making in a complex fiscal environment.

Keywords: Tax credits; Tax relief; Calculation regime.

1. Introduction

In recent years, internationalization has consolidated itself as a crucial strategy for Brazilian companies seeking to expand their competitiveness, diversify markets, and optimize economic-tax efficiency. In the national context, fiscal policies strongly stimulate exports, granting tax relief through the immunity of the Tax on Industrialized Products (IPI), the non-incidence of the Tax on Circulation of Goods and Services (ICMS), and the zero rate of the Social Integration Program (PIS) and the Contribution for the Financing of Social Security (COFINS).

Additionally, legislation allows for the maintenance of credits for Tax on Industrialized Products (IPI) and ICMS arising from the acquisition of inputs used in production destined for abroad. This mechanism contributes to the reduction of the effective tax burden and to the improvement of operational margins (Schoueri, 2021; Fabretti, 2022). However, the effectiveness of these benefits is directly linked to adequate tax planning and the strategic choice of the fiscal calculation regime.

The discussion on tax optimization is particularly relevant in industrial sectors characterized by reduced profit margins and high consumption of taxed inputs, as is the case in the textile industry. The challenge of internationalization for these companies lies not only in commercial expansion but in the ability to structure an efficient tax system that avoids undue costs and sustains competitiveness both in the foreign market and in domestic sales (Mendes, 2022; Schoueri, 2020; Sabbag, 2022). In this scenario, the decision between the Presumed Profit and Real Profit regimes plays a decisive role, as it directly impacts pricing, the calculation of federal taxes, and cash flow dynamics (Fabretti, 2021).

The company studied, a small-sized industry in the textile sector, operates in fabric finishing and under the Presumed Profit regime. Its foray into the international market is not configured as a structural expansion strategy, but as a pursuit of tax efficiency to reduce costs and strengthen its competitive position in the domestic market. The possibility of utilizing ICMS and IPI credits generated by exports represents a significant alternative to mitigate the high tax burden of internal operations. However, this transition requires in-depth technical analysis to determine whether remaining in Presumed Profit is still the most advantageous option or if migrating to the Actual Profit could yield more efficient results.

Given this context of fiscal complexity and the need for strategic decisions for financial sustainability, this work is justified by the relevance of providing technical subsidies that support business decision-making. Thus, this work aimed to comparatively analyze the tax impacts of remaining in the Presumed Profit regime in relation to a possible migration to the Actual Profit regime for a company in the textile sector undergoing internationalization, seeking to identify which alternative is more advantageous from an economic and fiscal point of view.

2. Material and Methods

The research was characterized as applied, with a qualitative approach, and adopted the case study as a technical procedure. The objective was to comparatively analyze the tax impacts of maintaining the Presumed Profit tax system in relation to a possible migration to the Real Profit tax system in a company in the textile sector undergoing internationalization, seeking to identify the most advantageous alternative from an economic and fiscal point of view.

The unit of analysis consisted of a small-sized Limited Liability Company, operating in textile processing, located in Santa Bárbara d’Oeste, in the interior of the State of São Paulo. Its main activity (CNAE 13.40-5-99) covers finishing services for yarns, fabrics, and textile articles. With internationalization, secondary activities of manufacturing special fabrics (13.54-5-00) and retail sale of fabrics (47.55-5-01) were added, allowing the production and commercialization of finished products.

Data collection was performed directly in the organization’s enterprise resource planning system, with authorization from management, and accounting and fiscal information was obtained from the responsible accounting department. The analysis period covered the 2025 fiscal year, chosen because it is the most recent with complete and consolidated data, and because it marks the effective start of the company’s export operations.

For the collection, the Income statement for the year (DRE) and the Balance Sheet of 2025, the Daily Book (records of revenues, expenses, and industrial operations), invoicing reports segregated by market, and industrial cost spreadsheets (including taxed and untaxed inputs) were analyzed. Data on the calculation of IRPJ, CSLL, PIS, COFINS, IPI, and ICMS, as well as export records (values, NCM, and CFOP), were equally considered.

The collected data were systematized in spreadsheets to enable comparative analysis between the Presumptive Profit and Real Profit regimes. Revenue information was classified according to the type of operation, and the taxes applicable to each modality were identified and grouped, considering the fiscal particularities of each regime. Industrial costs were organized by separating inputs for products intended for the domestic market and exports.

For the comparative analysis of the tax burden by sales destination, a specific production order was selected, corresponding to the only export operation carried out by the company in the analyzed period. This choice was based on the methodological relevance for comparing the impact of taxation on the same product in different markets, keeping constant the industrial cost, the quantity produced, and the unit value.

Comparative simulations were structured between the Presumed Profit and Real Profit regimes to evaluate the tax impacts of each framework. The calculation of IRPJ, Social Contribution on Net Income, PIS, and COFINS was considered, according to the rules of each regime. Export tax incentives (exemption of IPI, ICMS, PIS, and COFINS) and their impact on price formation and the utilization of tax credits were taken into account.

The analysis of the results was qualitative, based on the simulated scenarios. The tax and managerial impacts were evaluated, considering the company’s operational structure, the tax behavior of each regime, and the associated fiscal risks. The viability of any regime migration, administrative capacity, complexity of ancillary obligations, and effects on cash flow were also considered.

To contextualize the company’s economic performance and support tax analyses, the main elements of the Income Statement and the Balance Sheet for the year 2025 were consolidated. This step provided the economic basis for tax simulations and the comparative analysis between the calculation regimes.

3. Results and Discussion

The analysis of the research results allowed for an in-depth understanding of the tax impacts of internationalization in the textile processing industry, focusing on the comparison between the Presumed Profit and Real Profit regimes. Initially, the systematization of data confirmed the company’s classification as a small-sized organization, located in Santa Bárbara d’Oeste, São Paulo, with the main activity of finishing services on yarns, fabrics, and textile articles, according to CNAE code 13.40-5-99. The inclusion of secondary CNAEs after the commencement of export operations broadened the operational scope, enabling the acquisition of raw fabric, in-house processing, and commercialization of the finished product, both in the domestic and international markets.

The finishing activity, which involves chemical and physical applications to impart technical properties to fabrics, was characterized as industrialization due to the substantial transformation of the material, adding economic value and altering its fiscal classification. This change in the production chain and fiscal classification is crucial, as it defines the applicable tax treatment. The study considered the organization’s production structure, which includes industrialization on demand and own production for sale, establishing the operational and tax context for the comparative analysis of tax systems.

The classification of revenues, performed based on the Fiscal Operations and Services Codes (CFOPs), revealed that the company’s total invoicing in the fiscal year 2025 reached R$ 8,954,402.37. Of this amount, the largest portion, corresponding to R$ 8,879,514.80, originated from operations destined for the domestic market, including sales of the establishment’s production and industrialization for other companies. Export operations, although representing a reduced share of R$ 16,887.57 of the total invoicing, were duly segregated, indicating the initial phase of the company’s insertion into the foreign market.

The low representativeness of exports in total revenue did not compromise the analysis, as the study’s objective was not to measure international sales volumes, but rather to evaluate the tax impacts arising from these operations. The segregation of revenues by sales destination was fundamental for tax analysis, since each type of operation has a distinct fiscal treatment, especially regarding tax incidence and the possibility of utilizing tax credits, central aspects for the company’s competitiveness.

The organization of industrial costs in the fiscal year 2025 showed that the company’s total industrial cost was R$ 3,810,549.33. The main components of this cost were raw materials, totaling R$ 1,928,241.47, and general manufacturing expenses, which amounted to R$ 1,882,307.85. These data highlight the relevance of these elements in the formation of industrial cost and served as the basis for analyzing the tax impacts on production cost and operational competitiveness. For the comparative analysis of the tax burden, a specific production order was selected, with an industrial cost of R$ 10,104.20, composed of R$ 7,852.20 in raw materials and R$ 2,252.00 in general manufacturing expenses, to simulate different sales scenarios.

The survey of tax credits revealed that raw material acquisitions in the analyzed period totaled R$ 2,129,422.28. Of these acquisitions, R$ 355,438.00 of ICMS and R$ 18,815.07 of Tax on Industrialized Products were highlighted. These values are crucial for evaluating the potential for tax credit utilization, especially in the context of exports, where legislation allows for the maintenance of these credits, contributing to the reduction of industrial costs and increased competitiveness. The consolidation of this data is fundamental for assessing the impacts of the tax regime on the cost and competitiveness of operations.

In the Presumed Profit regime, contributions to PIS and COFINS do not generate credit rights, unlike ICMS and IPI, which allow for credit appropriation in export operations. The amounts of PIS and COFINS levied on the acquisition of raw materials, which were not utilized by the company in the analyzed period, totaled R$ 25,290.00 for PIS and R$ 112,846.38 for COFINS. These amounts highlight the potential for tax recovery if the company adopted the Real Profit regime, where the non-cumulative system of these contributions would allow the utilization of these credits, a relevant aspect for comparative simulations.

The comparative analysis of the tax burden by sales destination, using a specific production order, showed significant variations. In export operations (CFOP 7.101), the exemption of indirect taxes such as ICMS, IPI, PIS, and COFINS resulted in a total tax of only R$ 385.03, referring to IRPJ and CSLL. In contrast, domestic sales within the State of São Paulo (CFOP 5.101) generated a total tax burden of R$ 4,479.08, due to the incidence of PIS, COFINS, ICMS (18%), and Tax on Industrialized Products (3.25%), in addition to IRPJ and CSLL.

Interstate operations also presented distinct tax burdens. For sales with an ICMS rate of 12% (CFOP 6.101), the total taxes amounted to R$ 3,502.81. When the ICMS rate was 7% (CFOP 6.101), the total tax burden decreased to R$ 2,689.26. These results show that the tax burden varies substantially according to the destination of the sale, being significantly lower in exports, which reinforces the role of taxation as a determining factor in price formation and company competitiveness, regardless of changes in the production process or the unit value of the product.

The comparison of the economic impact of the tax burden by sales scenario revealed that, although the industrial cost of the production order remained constant at R$ 10,104.20, the net economic result varied considerably. Export sales showed the largest positive difference between revenue and total expenditure, resulting in a profit of R$ 6,398.36. In contrast, domestic operations in the State of São Paulo generated a profit of R$ 2,853.13, while interstate sales with ICMS of 12% and 7% resulted in profits of R$ 3,829.40 and R$ 4,642.95, respectively.

These findings reinforce the relevance of taxation as a strategic element in price formation and company competitiveness, corroborating internationalization as an instrument of tax efficiency. The exemption of indirect taxes on exports, such as IPI, ICMS, PIS, and COFINS, and the possibility of maintaining credits linked to the acquisition of inputs, contribute to the reduction of the overall tax cost and to the improvement of competitiveness, aligning with the destination taxation principle (Siqueira, Nogueira, & Luna, 2021).

The organization’s equity structure, based on the 2025 Balance sheet, showed a Total Assets of R$ 9,088,167.88, with a high concentration of short-term assets, including R$ 6,724,090.88 in cash and financial investments and R$ 923,627.60 in inventories. This equity composition is compatible with the company’s industrial activity and the initial phase of its internationalization process, providing the financial basis to absorb the tax impacts of the different alternatives analyzed.

The 2025 Income statement for the year (DRE), under the Presumed Profit regime, showed an Industrial Gross Revenue of R$ 8,896,402.37 and a Net Result for the Year of R$ 4,992,379.89. This high generation of operational and financial results reflects the relevance of the industrial structure and financial operations in the company’s economic performance (Bastos & Costas, 2023). These data were essential for tax simulations and for comparative analysis between the calculation regimes, allowing for a clear understanding of the dynamics between revenues, costs, expenses, and taxes.

The simulation of tax assessment under the Actual profit regime for the fiscal year 2025 revealed a Net Income for the Period of R$ 3,726,573.11. Although Actual profit allows for the utilization of PIS and COFINS credits, which totaled R$ 25,290.00 and R$ 112,846.38, respectively, this benefit was not sufficient to offset the increased tax burden resulting from the assessment of IRPJ and CSLL on the effective profit. The IRPJ under Actual profit was R$ 1,378,489.81 and the CSLL was R$ 504,896.33, values significantly higher than those under Presumed Profit.

This finding indicates lower tax-economic efficiency of Actual profit in the analyzed scenario, even with the deduction of federal credits (Ferreira & Araújo, 2021). The literature suggests that Actual profit tends to be more advantageous for companies with reduced margins or a high structure of deductible costs (Lima & Siqueira, 2022; Monteiro & Cunha, 2023), while Presumed Profit can be more efficient for companies with high profitability and lower operational complexity (Pacheco, 2023), as is the case with the company studied.

The complexity of the Brazilian tax system, with its multiplicity of indirect taxes and overlapping regulations, increases fiscal compliance costs (Sá, 2025), reinforcing the need for a strategic choice of the tax system that considers not only the nominal tax burden but also the associated operational and administrative costs. The final comparative analysis between the calculation regimes showed that the overall tax burden calculated under the “Lucro Real” (Actual Profit) regime, R$ 1,883,386.14, was higher than that verified under the “Lucro Presumido” (Presumed Profit) regime, R$ 881,125.12.

Consequently, the Net Profit for the Period under the Presumed Profit regime (R$ 4,992,379.89) was substantially higher than under the Actual Profit regime (R$ 3,726,573.11). This demonstrates that, in the analyzed scenario, remaining under the Presumed Profit regime proved to be economically more advantageous for the company. The choice of tax regime, therefore, is not merely a legal obligation but a fundamental strategic decision that must be integrated into the operational structure and market positioning, considering the impact on cash flow, the ability to utilize tax credits, and administrative complexity (Silva & Santos, 2021).

In summary, the results obtained confirm that internationalization, even in its initial stage, provides a significant reduction in the indirect tax burden and the maintenance of tax credits, improving the company’s competitiveness. However, the comparative analysis between the Presumed Profit and Actual Profit regimes demonstrated that, for the studied fabric processing industry, the Presumed Profit regime proved to be more advantageous from an economic-tax perspective, resulting in a higher net profit, even considering the potential for utilizing PIS and COFINS credits under Actual Profit. These findings reinforce the strategic role of taxation in competitiveness and business decision-making.

4. Conclusion

This study analyzed the tax impacts of internationalization in a Brazilian textile processing industry, comparing the Presumptive Profit and Real Profit regimes to identify the most advantageous alternative from economic and fiscal perspectives. It was found that internationalization, even in its initial stage, provided a significant reduction in indirect tax burden, such as IPI, ICMS, PIS, and COFINS, and the maintenance of tax credits, which contributed to the company’s improved competitiveness. However, the comparative simulations between the calculation regimes indicated that, despite the potential for PIS and COFINS credit utilization in the Real Profit regime, the overall tax burden calculated was higher than that of the Presumptive Profit regime. Consequently, the Presumptive Profit regime resulted in a substantially higher net profit for the company in the analyzed scenario, demonstrating its greater economic-tax efficiency.

The main contribution of this work lies in providing technical subsidies for strategic decision-making in a complex fiscal environment, highlighting how the choice of tax system and internationalization directly impact the competitiveness and financial sustainability of industrial organizations. As a limitation, the adoption of a static approach is highlighted, which did not consider variables such as exchange rate fluctuations, legislative changes, or market variations, thus restricting the generalization of the results. It is suggested that future studies deepen the analysis by considering dynamic scenarios, including economic projections, changes in tax legislation, and the expansion of international operations, in order to broaden the understanding of the impacts of taxation in the context of business internationalization.

Bibliographic References

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Ferreira, P. C., & Araújo, C. H. V. (2021). Efeitos da tributação sobre o desempenho das empresas brasileiras. Estudos Econômicos, 51(2), 345–370.

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Sabbag, E. (2022). Manual de direito tributário (14ª ed.). Saraiva.

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Silva, A. F., & Santos, G. R. (2021). Planejamento tributário e eficiência empresarial: uma análise empírica. Revista de Administração e Contabilidade, 13(2), 45–60.

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Article originating from the Course Conclusion Work of the Specialization in Tax Management of the MBA USP/Esalq

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