ICMS adjustment could increase prices in delicatessens in Bahia; government talks about tax equality

A change in the taxation of the Tax on Circulation of Goods and Services (ICMS) has left Bahian entrepreneurs in the delicatessen sector angry.

The Government of Bahia changed the taxation for the sector from 4% to 20.5%. The famous Bahian delicatessen, Almacen Pepe, in an internal note, informed that due to the significant increase in the tax burden, “it has become increasingly challenging to maintain competitive prices”, which forced the company to increase the final value of the products. The company cites grocery, dairy, frozen, cold cuts and sliced ​​items, as well as alcoholic beverages, which saw a greater increase in the rate, reaching 27% with the exception of beers.

Federal deputy Paulo Azi, state president of União Brasil, criticized the increase and suggested the impact also on bread. “The price of bread will rise because of the state government, which, in a fundraising drive, increases taxes without worrying about the consequences of this for the population. Those who pay this bill are the people, especially those who need it most, who will feel this new increase in ICMS in Bahia first hand”, said the deputy.

TAX EQUALITY

In turn, the State Finance Secretariat (Sefaz-Ba) stated that the tax benefit of reducing the ICMS to 4%, intended for the delicatessens sector, remains in force, having preserved the criteria and objectives for which this regime was created, that is, the incentive to sell self-made food items. In other words, it would not affect baking.

“Sefaz-Ba promoted adjustments to this taxation regime with the aim of preserving fair competition in the Bahian market. The change removed the possibility of reducing the tax burden for products such as wines, whiskeys, cheeses, cold cuts and sliced ​​meats and other items, especially imported food, sold by these establishments. By paying less tax for products on which other establishments are taxed at the standard ICMS of 20.5%, large delicatessens were gaining an advantage over the competition. The objective of the measure, therefore, is to guarantee tax equality”, said Sefaz in a note.

The ministry added that the effects of the adjustment promoted do not apply to micro and small taxpayers, who in practice do not need to resort to the reduced ICMS, considering that the benefits included in Simples Nacional are more advantageous.