For the president of the Chamber of Deputies, it still remains to be defined where the resources will go in the event of excess revenue
BRASILIA – The President of the Chamber, Arthur Lira (PP-AL), said that, according to the new fiscal framework presented by the government’s economic team Lula, there will be no difficulty in getting the issue passed by Congress. With the arrival of the text in the legislative chamber, expected on Monday the 17th, he promised to quickly designate a rapporteur and in two or three weeks, at the most, to vote on the proposal in plenary.
“As it was designed, we did not find any difficulty in these topics that have been covered. The investment difference within the growth margin is decent. You defend a growth of 4 (%) with an investment of 0 (%) No, you can’t invest 4 (%) if you grow by 3 (%), if you grow by 2 (%). Free channel of Banda. The speech was recorded last week, but the full was only released this Sunday the 16th.
However, Lira reflected on the need to define where the resources will go in the event of excess funding. According to him, these details will only be understood once the text reaches Congress. “Does it go to compulsory spending? Does it go to pure investment? Debt payment? These situations, we will only know when the cold text of the law arrives,” he said.
He pledged to quickly vote on the proposal in the House. “Our expectation is that, once the text has arrived, we will quickly appoint the rapporteur, and two, three weeks at the latest, we will vote in the plenary,” he said. As shown Broadcast Politico, deputy Claudio Cajado (PP-BA), an ally of Lira, should be the rapporteur for the draft fiscal framework that the government will send to the Chamber.
The fiscal rule announced by the economics team calls for a minimum annual growth of 0.6% in primary spending and a maximum growth of 2.5% in inflation. Within this band defined by the high and low, primary spending will be set at 70% of the previous year’s revenue growth.
In addition, a primary outcome range has been set for each of the years 2023 to 2026. The primary outcome target centers indicate a deficit limit of 0.5% of gross domestic product (GDP) this year , followed by a zero result 2024 and surpluses in 2025 (0.5% of GDP) and 2026 (1.0%). According to the presentation, the tolerance range in all years is 0.25 percentage points of GDP, plus or minus.
If the result falls below the band, the expense growth rate allowed by the new framework falls from 70% to 50% of the previous year’s revenue growth.
test for the government
During the interview, Lira also said that, even if there will be no changes in the text on the new fiscal framework that will be sent to Congress, the argument will not serve to test a solid basis of government in the House. Guidelines such as revised “tax turtles” and payroll exemptions will gauge the support base of the Executive in the Legislative, according to him.
“Hopefully the text reflects everything that has been discussed. If there is not a big change, we will not test the strong basis of government in it. We can test it in a discussion of payroll tax cuts, of revisiting incentives for certain sectors Then Yes, the government will have to be well oiled, with its organized base, to vote on these issues, which are the issues that will form the bedrock of the fiscal framework,” he said.
He underlined that “a lot” of unity will be needed for the interval between the votes on the framework, tax reform and guidelines launched by the government to increase revenue – defined by Lira as topics necessary for the tax framework to “hold up”.
The Speaker of the House assessed that despite the disagreement between him and the government on some issues, the framework and review of the tributary turtles are discussions that will be receptive to the House. He recalls that the Chamber has already dealt with the taxation of dividends, with a decrease in income tax for legal entities, as well as defining incentives for the pharmaceutical, chemical, mining and cosmetic sectors.
“I think there can be a successful election for the presidency of the Chamber without the support of the PT, but I have accepted the support of the PT, I have a friend within the party, and not because I have accepted the support, not I don’t feel comfortable not helping,” she said, citing government guidelines. Instead, he reiterates that the discussion on the fiscal framework, in addition to the tax reform, concerns the country, and not just the Executive.
Tax reform
Lira also argued that the alternative of a double value added tax (VAT) would streamline many discussions in the House on tax reform. Double VAT – i.e. a single federal tax and a state/municipal one – is envisaged in the proposed PEC 110/2019 and has been identified as a way to reduce the conflict of interest between representatives of the public power and sectors of the private sector.
“Our job here will be to remove obstacles. Double VAT already unlocks many things,” he said during the interview.
The president of the Chamber said that deputies are attentive to the needs of the sectors and should participate in seminars and meetings to mature the debate on the reform. “Everyone is going to the free zone in Manaus this week, (discuss) the question of the rate of the states. We can bring this discussion, we want to bring the governors into the tax reform thesis as well,” she said.
He also recalled that the Chamber has worked to reduce divergences in relation to the tax reform, trying to balance the interest and participation of the various sectors. “We’re trying to reduce the hotspots. Specific hotspots, major industries, state governments, municipalities, and agribusiness.”
However, the Speaker of the Chamber recognized the difficulty in relation to the period between the tax framework and the tax reform. The forecast is that the two projects will be voted on in the first semester. “It will take a lot of unity to decide the interval between the framework and the tax reform,” he said.
Source: Terra
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