Tax reform should not reduce burden, says Alckmin

The Vice President of the Republic and Minister of Development, Industry, Commerce and Services, Geraldo Alckmin (PSB), said, at an event with businessmen at the Federation of Industries of the State of Paraná (Fiep), in Curitiba (PR), that the reform tax, pending in Congress, should not result in a reduction in the tax burden. Last year, according to the Treasury Secretariat, it was 33.71% of GDP.

He also pointed out that the changes should not result in an increase in taxes either. The goal, according to him, is federative neutrality. “What municipalities receive, they will continue to receive. There will be simplification, withdrawal of cumulativeness and exemption from investment and exports. The reform will bring economic efficiency”, he highlighted.

Alckmin assesses that one of the major obstacles to the Brazilian economy is the complexity of the tax system, anchored in a tax on consumption, which increases the cost of producing in the country.

“The whole world has a consumption tax, which is VAT, we have five: IPI, PIS, Cofins, ICMS, ISS. All on consumption. In the United States, the consumption tax is 20%. It taxes income and assets there. In Brazil, 50%. Then the country is expensive, the population is not able to consume ”, she explained.

He pointed out that the Brazilian tax complexity also affects the performance of the country’s industry in international trade. “It is expensive to export. It exports soybeans, crude oil and iron ore. It does not achieve added value, it is expensive, it loses competitiveness, ”he said.

The simplification of rules, according to him, will help reduce bureaucracy. “We have a cartorial heritage. We have rule after rule. It is necessary to change this reality.”

Deputy says he does not understand current interest rate levels

Following the example of other government leaders, Alckmin said that the current Selic rate is difficult to understand. “In 2020, with annual inflation at 4%, we had a rate of 2% per year. Now, in 2023, with inflation lower than 4%, we have interest rates of 13.75%”.

The effects, according to him, are the inhibition of investments in all sectors and the difficulty to consume. “With the new tax regime (which is being discussed again in the Chamber after changes in the Senate, we will have all the conditions to reduce interest rates”.