Lira places itself as guarantor of the tax reform – 7/2/2023 – Market

In search of an emblematic brand for his management at the head of the Chamber of Deputies, the President of the House, Arthur Lira (PP-AL), has been placing himself as a kind of guarantor of the tax reform in an attempt to finally unlock the vote on a proposal that skates for years in the Legislature.

The approval of a broad reform of taxes on consumption, as is now intended through the PEC (proposed amendment to the Constitution) reported by deputy Aguinaldo Ribeiro (PP-PB), is not something trivial and collides with the enormous variety of interests and sectors involved in the discussions.

In the last few days alone, the text presented by Ribeiro has already been the target of a series of requests for adjustments from segments that did not feel fully contemplated in the proposal.

In all previous attempts at approval, pressure and the lack of consensus ended up undermining the chances of advancing the reform.

This time, however, congressmen cite at least two factors that increase the chances. The first is the degree of rejection of the current tax system, extremely complex and showing signs of exhaustion in the face of the tax war between states and the myriad of special regimes and patches to contemplate certain sectors.

The second factor is precisely Lira’s commitment to articulating the reform, calling meetings to discuss points of dissent and asking parliamentarians to give the text a chance before criticizing it. He also signaled the possibility of voting on the text in the first week of July.

In addition to the symbolism that the approval of the tax reform would bring to her management, Lira would have, in overcoming such a thorny matter, an opportunity to secure herself before the Planalto Palace, at a time when parliamentarians from her party, the PP, are seeking space for the caption within the Executive and covet command of folders such as the Ministry of Health.

The advance of the PEC under Lira’s hands would also help to divert the focus of recent investigations by the Federal Police that first hit their close allies and now approach the mayor himself — the name “Arthur” was in payment notes found com investigated for alleged deviations in robotics kit contracts, which led to the case being sent to the STF (Federal Supreme Court).

Allies of the President of the Chamber point to the tax reform as a chance for Lira to make a historic mark on his administration, like his predecessor, Rodrigo Maia (PSDB-RJ), who became known for having dedicated his political capital to the negotiations to approve the pension reform in 2019.

On July 10, 2019, when the plenary of the Chamber voted on the basic text of the PEC of Social Security in the first round, Maia was honored by the parliamentarians and cried when celebrating the approval of the proposal. He also abdicated his prerogative as President of the Chamber to abstain from voting and positioned himself in favor of the text.

Maia also supported the tax reform, whose rapporteur was already with Aguinaldo Ribeiro, but the then Minister of Economy, Paulo Guedes, rejected the format of a broad reform of taxes on consumption —which made it difficult for negotiations to advance.

Now, in Lula’s (PT) government, the tax reform PEC has returned to the center of strategic agendas in the economy, under the hands of Minister Fernando Haddad (Finance) —with whom Lira has had a close relationship in negotiating proposals.

“Among the priority agendas for this year, I highlight tax reform and the approval of a new fiscal paradigm. I have no doubt that the simplification of our tax system will have positive effects on tax collection and social justice. definitive solution to this challenge”, said Lira in a speech on February 2, the day he was reappointed to the Presidency of the Chamber with a record number of votes and with the support of the PT.

On the last 22nd, Lira called a meeting with governors and state finance secretaries, at the official residence of the Chamber, to try to resolve one of the main points of impasse: the federative issue.

In addition to the divergence with the Union over the value of the fund that will pay for regional incentives, the states disagree with each other on some points of the reform, such as the centralized collection of the new IVA (Value Added Tax).

At the meeting, according to reports, Lira asked for pragmatism to approve the PEC. He also promised to release the text on Thursday (22), despite calls from allies for the announcement to be postponed to prevent the replacement from being exposed to criticism for a long time before being voted on.

When releasing the text to the public, the rapporteur made a deference to the president of the Chamber and stated that he has played an important role in the negotiations.

“My word of thanks also to President Arthur Lira, who is leading this process, coordinating and commanding, including a defined calendar for voting on the reform”, said Aguinaldo Ribeiro.

According to reports made to the report, Lira has shown interest in studying the text of the reform to successfully block pressure from sectors for flexibility in the proposal. There are those who consider that the “tractor” style of the president of the Chamber in the votes can even help to approve the PEC, while others emphasize the need to guarantee a basic input: to gather votes.