Haddad admits that new exceptions increase the rate to up to 27.5%

The Minister of Finance, Fernando Haddadadmitted that the new benefit exceptions included by the Senate rapporteur, Eduardo Braga (MDB-AM), increase the standard rate of future value-added tax (federal, state and municipal) to up to 27.5%.

Haddad met this Thursday, 2nd, with Braga at the Ministry of Finance to discuss the approval of the matter in the Senate.

“The position of the Treasury is always restrictive to exceptions [benefícios a setores da economia]. This is public, but both Aguinaldo Ribeiro [relator na Câmara] as for Braga [relator no Senado] are committed to approving the reform. They know the difficulties, they know the interest groups that are demonstrating there. There, you know the game is rough. People need to resist as much as possible, with common sense, with argument, to compose the necessary votes”said Haddad.

According to Haddad, the concessions made by Braga in the Senate text represent an increase of 0.5 percentage points in relation to the text that passed in the Chamber of Deputies. At the time, the technical area of ​​the Ministry of Finance indicated that future VAT could reach up to 27%. This would already be one of the highest rates in the world.

The new wording of the reform included in the list of sectors that will receive a 60% VAT discount, for example, sporting activities and institutional communication. Furthermore, the text creates a rate with an intermediate reduction of 30% for the provision of services of an intellectual profession, of a scientific, literary or artistic nature. Complementary Law will establish the benefited operations.

The tax reform eliminates five taxes (PIS, Cofins and federal IPI, state ICMS and municipal ISS). Instead, the federal tax will be created, which will be called Contribution on Goods and Services (CBS), and the state tax, Tax on Goods and Services (IBS).

The expectation is that the text will be voted on by the Senate Constitution and Justice Committee (CCJ) next Tuesday, the 7th, before going to the House plenary. “We are going to complete a historic task, after 40 years. She is perfect? Nothing is perfect. But in light of what we have, the leap in quality is invaluable”added Haddad.

As the text has undergone changes in relation to what was approved by the Chamber, the PEC will need to undergo a new analysis by deputies.