The Vice President of the Republic and Minister of Development, Industry, Commerce and Services, Geraldo Alckmin, stated, this Monday (29), that he is an enthusiast of tax reform, which will bring numerous benefits to the country.
“The first is simplification. Let’s take the example of cheese bread, which was taxed as pasta, at 7%. After a few years, it became a bakery product, and the ICMS [Imposto sobre Circulação de Mercadorias e Serviços] it went to 12%. On the Minas Gerais side, it is in the basic basket, it is 0%. Imagine more complex products. So, simplification is extremely important”, said Alckmin, at the opening of the event Tax Reform and Industry: The Challenges of Regulation, organized by the Federation of Industries of the State of São Paulo (Fiesp).
He highlighted the importance of transparency, as many taxes are invisible and highlighted that the United States has less than 25% tax on consumption, while Brazil has almost 50%. “With the reform, it will become clear how high the tax burden is in Brazil, how high it is for the country’s level of development. It takes away competitiveness, it costs money, it makes consumption difficult,” he said.
For Alckmin, the current tax burden is regressive, because millionaires and those who earn a minimum wage pay the same rate. In addition, there is the poor allocation of investment. “I was governor, and no one said they were going to take the industry elsewhere because there was better science and technology, education, logistics. It’s all tax artifice: ‘I’m going to take it there because they’re giving me back the tax, it’s all tax artifice’”.
According to the vice-president and minister, with the reform, this will be 90% resolved, because the tax will no longer be paid at origin to be paid at destination, drastically reducing the tax war, complexity and litigation. According to Alckmin, in 12 years, the tax reform could increase GDP by 12%, investment by 20%, exports by 12% and industry, which is overtaxed, by 12%..”
Alckmin recognized that there are difficulties in implementing the reform and highlighted that the best path in the case of complex changes is gradualism. “It would be great if it were implemented next year, but it is better that it is done, even in six years, than not happening at all.”
He also praised Fiesp’s initiative with the creation of the Tax Observatory, launched at the event. According to the president of Fiesp, Josué Gomes, the objective is to provide technically produced information regarding what happens in taxation.
