The Brazilian tax authority recently issued Ruling No. 7/2016, which clarifies the deduction of credits related to the acquisition of goods and services under the non-cumulative regime for the Contribution for the Social Integration Program (PIS) and the Contribution for the Financing of Social Security (COFINS). According to the ruling, the deduction of input credits is only allowed if the goods and services acquired are directly related to the production of goods for sale or services provi…