Tax reform rapporteur proposes lower tax rate for self-employed professionals

The rapporteur of the tax reform in the Senate, Eduardo Braga (MDB-AM), said that he will propose a different rate for independent professionals, such as lawyers, doctors, accountants and engineers, in the text of the tax reform (PEC 45/19), which will be presented this week. The information was confirmed by the senator, this Monday (23), after a meeting at the Ministry of Finance, with minister Fernando Haddad and the secretary for Tax Reform, Bernard Appy.

“Do you have those [profissionais] who are in Simples and those who are above Simples. Then, the tax burden approved by the Chamber text greatly increased the tax for these professionals. So, it’s that saying ‘not too much, not too little’. Neither stay with the current rate, nor establish a rate that would end up forcing them to end up dismantling the ‘pejotization’ of these professions,” he said.

Braga mentioned that the rate should be lower than that applied to other sectors, but said that it has yet to be defined. “Not yet (there is a definition), because there is an intention in the proposal presented by the OAB (Brazilian Bar Association) and we have a counter-proposal. But I think it will give understanding and we hope that by tomorrow (Tuesday) the we can define,” he said.

According to Braga, the limitation for independent professionals is important to prevent large offices from having to migrate to Simples Nacional – a tax regime for micro and small companies with an annual revenue limit of R$4.8 million.

The new text of the reform also provides for the review of differentiated regimes every five years. The high number of exceptions is a concern for the government, as it could increase the general rate. “I think this is an important signal for the market and an important signal for the Brazilian nation,” said Braga.

Another change will be the increase in the Regional Development Fund (FDR), which aims to combat inequalities between regions. Braga guaranteed that the amount could increase, but did not give details. “We are fighting for this”, he informed.

Processing

Senator Eduardo Braga’s report should be presented this Tuesday (24) to the Senate’s Constitution and Justice Committee (CCJ). The reading will take place the following day, Wednesday (10/25). The deliberation within the CCJ is scheduled for November 7th.

If the PEC is approved by the committee, the text will go to the plenary. If the changes made by the senators are confirmed, the proposal goes to a new vote in the Chamber of Deputies.