TAX EXEMPTION AND THE LIMITS OF BUSINESS ACTIVITY: AN ANALYSIS OF THE STRATEGIC USE OF EXEMPTION AS A COMPETITIVE ADVANTAGE IN THE MANAUS FREE TRADE ZONE

Abstract

 This article analyzes the strategic use of tax exemptions by companies in the Manaus Industrial Hub (PIM) from the perspective of the structural transformations introduced by the Tax Reform, embodied in Constitutional Amendment No. 132/2023 and Complementary Law No. 214/2025. The central objective is to investigate how these tax incentives can be instrumentalized as a sustainable competitive advantage, while observing the limits of legality and the socioeconomic purpose intrinsic to the Manaus Free Trade Zone (ZFM) model. Methodologically, the research is based on a qualitative and descriptive approach, using the deductive method anchored in bibliographic, documentary, and jurisprudential review. The results show that maintaining competitiveness in the new tax scenario requires companies to transition to high-compliance tax governance and tax planning models, prioritizing efficiency in credit management and transparency. It is concluded that the strategic use of exemptions remains legally legitimate and economically viable as long as it is strictly aligned with the social function of the company and the constitutional objectives of regional development and reduction of inequalities.