Lula wants to remove urgency for interest on equity – 09/05/2023 – Market

President Luiz Inácio Lula da Silva (PT) asked the National Congress to withdraw the urgency of the bill that proposes to end, starting next year, with the JCP mechanism (interest on own capital), an alternative way for a company to remunerate its shareholders paying less taxes.

The project had been sent to parliament last week, on the same day that the government announced the taxation of exclusive funds, the so-called “super-rich” and offshore companies.

The withdrawal of the urgent request was published this Tuesday (5) in the Official Gazette.

The JCP allowed the deduction of interest paid or credited as remuneration on equity in the calculation of Income Tax and CSLL (Social Contribution on Net Income) of large companies. The measure is part of the Income Tax reform scheduled for this second half.

The change does not affect the deduction of interest in relation to the results of 2023, even if paid or credited in 2024, according to the proposal that will still be analyzed by Congress.