According to the secretary, the more some sectors receive a differentiated treatment in the tax reform, the higher the rate will be applied to the others.
A tax reform planned by the government should maintain the current load of taxes unchanged, given the government’s need to sustain the current level of revenues, said the Extraordinary Secretary for Tax Reform of the Ministry of Finance, bernardo appy.
“One of the assumptions of the tax reform is to maintain the tax burden. It will not increase the tax burden at all, but at this moment the country’s tax situation does not allow us to reduce the tax burden,” he said on Monday 15, in an interview with GlobeNews.
He added that the government is trying to strike a balance between the technical quality of the reform and the support it will receive in Congress.
“Our ideal is that tax reform is technically the best, but politically feasible,” he said.
He underlined that a reform without exceptions for some sectors “is not politically feasible”, but it will be up to Congress to define who will receive differentiated treatment and what the extent of this benefit will be.
“What’s important to us is that the more favorable treatment some industries get, the higher the rate will have to be applied to other industries,” said Appy. “Our role is to speak to the national Congress, show the costs, benefits and different alternatives that can politically help the approval of the tax reform,” she added.
Approval by July
Planalto intends to pass the tax reform in the House by mid-July, but first wants to receive the green light from Congress for the new tax framework, Appy said.
“First, obviously, the framework will be voted on. My perspective is that, in a couple of weeks, it will probably already be voted on,” he said, adding that the tax reform opinion should come later.
“Our perspective is still, yes, to approve the tax reform in the Chamber of Deputies by the end of this first legislative semester, i.e. until mid-July to approve the tax reform in the Chamber of Deputies,” he said.
Source: Terra
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