Haddad’s tax adjustment depends on hunting ‘tortoises’ and increasing the tax burden – 03/30/2023 – What tax is this

The second major announcement of fiscal adjustment measures by the Ministry of Finance confirms the option of the Luiz Inácio Lula da Silva (PT) government to make a fiscal adjustment mainly on the revenue side, and not focused on expenditure, as many economists wanted.

After moving forward on the issue of tax litigation in January, with the provisional measure of Carf and Litigation Zero, Minister Fernando Haddad announced this Thursday (30) an action to review benefits and tax new sectors to raise up to R$ 150 billion. Details will be announced next week.

The goal is to put an end to what he classified as the big tortoises that turned our tax system into chaos. “One of the largest herds existing today in this country is the number of tortoises that entered our tax system and made this model chaotic,” he said.

The changes have nothing to do with the tax reform that is underway, which will solve so many other problems, Haddad highlighted.

Since 2022 economists linked to the current government have argued that the increase in the tax burden is not treated as a taboo, but as a way to promote investments and public policies to reduce inequalities — although the money also finances less noble expenses.

The minister said that there will be no increase in the tax burden in the sense of creating new taxes or increasing the rates of current ones. He preferred to call the movement “recomposition of the fiscal base”.

Lawyers in the tax area are in no doubt that the government is thirsty for revenue. It is with this scenario that economists must work.

Zero Litigation

Adherence to the Zero Litigation program ends this Friday (31). Lawyers reported great interest from the companies after an announcement made in January, but the payment terms, after the calculations were made, discouraged many taxpayers.

There is always the possibility of extending deadlines, but the assessment is that the strict rules and the short payment period may have compromised the success of the program.

The government estimates that it will obtain BRL 35 billion in extraordinary revenues and a permanent gain of BRL 15 billion from the reduction of conflicts.

PRESENT LINK: Did you like this text? Subscriber can release five free hits of any link per day. Just click the blue F below.