Income Tax: Lula wants to exempt salary of up to R$ 5,000 – 07/25/2023 – Market

This Monday (25th), President Lula reiterated his promise to exempt wages of up to R$5,000 from Income Tax and stated that anyone living on dividends should pay tax.

In his weekly live broadcast on social media, the president also said he was elected to “take care of the working people”, and asserted that bankers do not need to be taken care of by the government.

“Until the end of my term, whoever earns up to R$5,000 will not pay income tax. Listen to what I’m saying: until the end of my term, whoever earns up to R$5,000 will not pay income tax,” insisted Lula, repeating a promise made in last year’s election campaign.

“Who has to pay income tax is who is rich, is who lives off dividends, who evades, it’s not the working people”, he added.

In May, the government issued a provisional measure that increases the exemption from Income Tax for Individuals for wages up to R$ 2,640, equivalent to two minimum wages.

Also in May, the Minister of Finance, Fernando Haddad, said that he still does not know how to make feasible Lula’s promise to exempt wages of up to R$5,000 from income tax, amid the country’s current fiscal scenario. The minister recalled that the measure is a government determination, but that it is a “challenging task”.

Haddad also intends to submit to Congress by the end of this year a proposal to reform income taxation, which should include the return of taxation on profits and dividends.

The minister, at the same time, recently recognized that this part of the tax reform should face more resistance than the tax reform on consumption, approved in the Chamber of Deputies and now being discussed in the Senate.

In his live, Lula also said that he returned to govern Brazil to take care of the poorest, but not the bankers.

“The government’s role is to take care of people. In fact, the word governing should be abolished. It’s the following: I’m going to be elected to take care, take care of what? Take care of the people. What people? Because there are people who don’t need you to take care of, bankers don’t need you to take care of,” said Lula.

“You need to take care of those people who work, who pay income tax, who are unemployed, those people who are homeless. These are the people who need the figure of the State”, he added.