Parallel regulation is a threat to tax reform – 03/11/2024 – What tax is this

It is Sheet recently published a report by journalist Adriana Fernandes entitled “Parallel proposal to regulate tax reform will take power away from the tax authorities”.

We had already understood the approval of Constitutional Amendment 132 as a starting point, not as a finish line, because we knew that the discussions on its regulation would be the subject of an even more intense debate, as those who excluded themselves from the discussions also participate in it. of PEC 45 because they doubted its approval.

The information that there is a parallel proposal being created requires us to be even more vigilant and willing to engage in good public debate.

According to the report, the idea for parallel regulation came from a group of parliamentarians, which includes opposition deputies who voted against the PEC and who are dissatisfied with the lack of private representation in the working groups formed by the government to prepare the draft laws. that will regulate the Constitutional Amendment.

The government’s choice is rational, given the limited time needed to send matters to the Legislature — just 180 days, defined by the PEC. A deadline that, in practice, is even shorter, until the end of March, due to the imposition of Congress’s political agenda.

Furthermore, opening the technical groups to private participation would require a prior definition that, in itself, would already consume the entire term: who represents the taxpayer in tax discussions? Tax law firms? The National Confederation of Industry? The Landless Workers Movement?

All of them, without a doubt, have legitimacy for this debate, but the wide openness of the groups would make the achievement of their objectives unfeasible and would advance a debate whose original place is in Parliament.

Parallel regulation enthusiasts are turning this dissatisfaction into a pretext for weakening tax administrations by stripping them of their power to lower standards. Here we enter into a relevant debate on the merits.

The regulatory power of the Tax Authorities is in the interests of the taxpayer himself. The reality is dynamic and complex, therefore laws cannot exhaust all possibilities for commercial transactions.

Therefore, it is necessary for the Tax Authorities to standardize and interpret the legislation, making it clear to the taxpayer how he should proceed. Were it not for this normative power, tax laws would be a source of inexhaustible litigation — even more than is recorded today, with tax litigation reaching an absurd 75% of GDP.

It is essential that we look at reality from the new perspective imposed by Constitutional Amendment 132. As it establishes simpler, more effective and general legislation, the Tax Authorities will no longer need to manage exceptions. In other words, the need to exercise regulatory power will be much less in the new tax reality.

The deputies’ intention to “weaken” the Tax Authority, as the report says, does not bring benefits under any analysis guided by republican criteria. What would result from an action like this would be a drop in tax revenue and the consequent unfeasibility of public policies.

The tax reform instituted by EC 132 is complex — a change in practices and paradigms. The amendment itself admits this by establishing the validity period only from 2027.

Its operationalization will depend on the development of new systems and the creation of new structures and arrangements, guided by the integrative and collaborative action of the Tax Authorities. All this detailed work will be done by tax administrations. To weaken them now is to weaken the reform itself, it is to prevent the great cry of Brazilian society for a fairer and more efficient tax system from being met.

We are absolutely certain that the vast majority of parliamentarians do not agree with this parallel project to weaken the Brazilian State.

LINK PRESENT: Did you like this text? Subscribers can access five free accesses from any link per day. Just click the blue F below.