Eduardo Braga wants to approve tax reform by November 9th

Senate

Braga reported that he has already received more than 380 amendments from senators to the project

Brasilia DF) – Senator Eduardo Braga (MDB), rapporteur for the tax reform, told the press that he will present his report on October 24th and that voting on the project must be completed by November 9th. According to Braga, this calendar was negotiated and approved between the presidents of the Senate and the CCJ.

“There was a meeting with the president of the Senate, Rodrigo Pacheco, and the president of the CCJ, Davi Alcolumbre, and the 24th was agreed for the presentation and reading of the report at the CCJ. As there is a holiday, you end up voting on the 7th at the CCJ and go to the plenary session on the 7th, 8th or 9th. [de novembro] to vote”,

informed Braga.

He met, this Tuesday (10), with the governors of Santa Catarina, Jorginho Mello; from Rio Grande do Sul, Eduardo Leite; from Paraná, Ratinho Júnior; and from Mato Grosso do Sul, Eduardo Riedel, to deal with tax reform. The government secretaries of these four states, who are members of the Southern Development and Integration Council (Codesul), also participated. They presented suggestions for changes to the rapporteur.

PEC 45/2019 unifies tax legislation, seeks to reduce taxes on consumption, provides for the creation of funds for regional development and to finance ICMS credits until 2032.

The proposal abolishes several currently existing taxes on consumption and creates two, one under federal jurisdiction (Contribution on Goods and Services – CBS) and another shared by states and municipalities (Tax on Goods and Services – IBS). It also opens space for the creation of the Selective Tax (IS – the so-called sin tax, which will apply to products such as alcoholic beverages and cigarettes).

At the federal level, the Tax on Industrialized Products (IPI) would be abolished; the Contribution to the Social Integration Program (PIS/Pasep Contribution – but the contribution on current revenues will remain, which will be called Contribution to Pasep) and the Contribution to the Financing of Social Security (Cofins).

At the state and municipal levels, two taxes would be abolished: the ISS (Tax on Services of Any Nature) and the ICMS (Tax on Operations relating to the Circulation of Goods and on the Provision of Interstate and Intermunicipal Transport and Communication Services). It is also planned to create a Federative Council for the IBS and the Regional Development Fund.

Braga reported that he has already received more than 380 amendments to the project from senators. He said that the Federative Council will only be a management committee, which collects and distributes, along the lines of the Simples Nacional management committee.

“My vision of the Federative Council is that it is a management body and an administrative committee [do IBS]without competence for legislative initiatives and without competence to decide federal issues”,

said Braga, anticipating possible changes to the text of the PEC.

The senator added that the Regional Development Fund to be created will be “a great mechanism for the economic development of the regions” and will serve to reduce economic and social inequalities. However, Braga said that the fund’s sources of resources will have to be very well defined, so that there are sufficient resources to boost the development of all regions.

Governor and former senator Jorginho Mello said that the governors asked for the creation of a constitutional fund for the South region, like those that already exist for the North, Northeast and Central-West regions. In turn, Governor Eduardo Leite asked that the criterion for dividing resources from the Regional Development Fund be established by the PEC.

*With information from the Senate

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