For representative of trade groups, text debated by government will be locked if it continues in current format
Alfredo Cotait Netopresident of CACB (Confederation of Commercial and Business Associations of Brazil), assesses that the tax reform on consumption will be blocked by society because it implies tax increases for some groups, such as the services sector.
The executive affirms that the best way is to change the legislation in stages. First, simplifying taxes. Second, ending the tax war. Third, maintaining the overall tax burden.
In an interview to the press, this Wednesday (12.Apr.2023), Cotait Neto commented that the texts under the greatest debate in Congress, the PEC (Proposed Amendment to the Constitution), number 45 and number 110, are not the best options for the country.
The executive fears that 2.1 million small businessmen and women have increased their tax burden with the implementation of the proposals. The services sector, according to him, represents more than 60% of the jobs created in the country.
In the executive’s view, the ideal would be for the government to first carry out an administrative reform to reduce the size of the State. Then, a change in taxes and, finally, the creation of a fiscal framework to reduce the size of the public debt.
The government Luiz Inacio Lula da Silva (PT), on the other hand, wants to approve the new fiscal rule in this 1st semester. Then tax reform. There is no discussion about a possible administrative reform.
For Cotait Neto, the new fiscal rule (which will replace the spending ceiling) will be approved by Congress. But the discussion around tax changes may run out of steam by the end of the year.
“The ideal is to start an administrative reform first and then balance the taxes”, stated.
According to him, it is necessary to unify rules to end the tax war between states and cities. The list includes ICMS (Tax on Circulation of Goods and Services) and ISS (Tax on Services of Any Nature).“Tax war is harmful for the country.”
The businessman praised the Minister of Finance, Fernando Haddad, for seeking to increase taxes on sectors that are currently not burdened, and, with that, preserve other economic groups. “Haddad is doing well and even surprises”he declared.
One of the praised measures is the higher taxation of companies that bring products from abroad without paying the same amount of taxes as national companies.
For Cotait Neto, it is natural that the population wants to buy cheaper products. But, in the long run, this import has “destroyed” the national industry and the Brazilian merchant. In his assessment, there is unfair competition.
“We have to think about the collective, the nation.”
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