The Minister of Finance also mentioned the 30% limitation on corporate tax compensation and the phasing out of Perse
The Minister of Finance, Fernando Haddad, presented this Thursday (28 December 2023) measures to increase revenues and offset expenses. Among the actions announced are:
- reduction of the employer’s share – the rate will be between 10% and 15% (currently 20%) on a maximum of 1 minimum wage and will benefit companies that are part of one of the 42 economic activities subject to a provisional measure to be published;
- gradual extinction of the Perses (Recovery Program of the Emergency Events Sector); AND
- annual limitation on the compensation of tax credits obtained for companies by court decision – will include credits exceeding R$ 10 million and within 5 years.
“It’s a data mining job [mineração de dados]“Haddad said in an interview with reporters.
The Minister of Finance even stated that the maximum tax compensation ceiling for businesses would be 30%, but the Poder360 found that the percentage is not defined.
“We are limiting what companies can compensate from one year to the next”, Haddad said. Without mentioning them by name, the Treasury holder stated that they existed “multinationals that don’t pay” taxes.
The Perse-related measure, in turn, will help replace losses of R$6 billion by extending the payroll tax exemption for 17 sectors. Haddad said the program had a larger revenue impact than expected.
“The projection was R$4 billion per year. We close this year with over R$16 billion in tax exemptions. This is the part informed to the taxpayer”he said in an interview with journalists.
Haddad also said that the tax exemption with Perse could reach up to R$ 100 billion in 5 years and called the program “jabuti”. He stated that the program should last 2 years.
The measure created in 2021 to mitigate losses suffered by events industry companies during the covid pandemic is expected to remain in place until 2027.
Temporary measure
An interim measure will validate the announced actions. The text is in the Civil Chamber for publication, according to the special secretary of Federal Revenue, Robinson Barreirinhas. In an interview with journalists, he stated that the estimated impact is approx R$20 billion continuously changing in 2024.
There were also questions to Haddad about the overall value of revenue expected for next year, but the minister simply said that the measures “they only replace losses” with tax exemption.
The government needs at least R$168.5 billion in additional revenue to reach the goal of zeroing the primary deficit in 2024. With the measures taken, however, the budget gap could reach R$187.5 billion .
Sérgio Lima/Poder360 – 28.Dec.2023 From the left. to say: the special secretary of federal revenue, Robinson Barreirinhas; the Minister of Finance, Fernando Haddad; and the Minister of Economic Policies, Guilherme Mello, during an interview with journalists Sérgio Lima/Poder360 – 28.12.2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (28.12.2023) Sérgio Lima/ Poder360 – 28.12.2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (28.12.2023) Sérgio Lima/Poder360 – 28.12.2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (28.Dec.2023) Sérgio Lima/Poder360 – 28.Dec.2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (28.Dec.2023) Sérgio Lima/Poder360 – 28. Dec. .2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (28.12.2023) Sérgio Lima/Poder360 – 28.Dec.2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (12.28.2023) Sérgio Lima/Poder360 – 12.28.2023 The Minister of Finance, Fernando Haddad, in an interview with journalists this Thursday (28.12.2023) Sérgio Lima/Poder360 – 28.12.2023 The Minister of Finance, Fernando Haddad (foreground), in an interview with journalists this Thursday (28.12.2023) | Sergio Lima/Poder360 – December 28, 2023
Haddad seeks Congress
Haddad spoke with the presidents of the House, Arthur Lira (PP-AL), and the Senate, Rodrigo Pacheco, before announcing the provisional measure. OR Poder360 found that the two leaders told the minister that it would be unwise to institute a rule to immediately impose a change in the payroll liens system.
OR Poder360 The lawmakers’ sentiment also reveals that Congress is unlikely to approve a new system that will change everything in January.
Salary exemption
The president of Congress, Rodrigo Pacheco (PSD-MG), launched this Thursday (28 December 2023) the renewal of the law that exempts salaries from 17 sectors of the economy until 2027. The measure will also benefit cities with a maximum of 156,216 inhabitants with the reduction of the social security rate from 20% to 8% on the salaries of public employees.
OR Poder360 he asked the Ministry of Finance if the deputy will revoke what was defined by Congress and there was confirmation. Here is the answer:
“The Revenue Agency clarifies that the provisional deputy will revoke the law, underlining that the minister has stressed that the issue relating to municipalities will be dealt with separately.”
As approved by Congress, the exemption extension will take effect January 1, 2024. By repealing the law, businesses and municipalities will have an immediate expense.
Regarding the phased paycheck refund, Haddad said there will be an exemption range of up to 1 minimum wage and equated it to what happens with income tax, which exempts from taxation those who receive up to R $2,112. Haddad said the action could reduce pay even for those earning up to 10 minimum wages.
The minister said yes “very little sought after by the 17 sectors” to discuss the exemption and said that the expected effects, such as job retention, had not materialised.
“Employment in these 17 sectors has declined. This measure was adopted in 2011 as temporary. […] Every time you favor a sector that does not bring social benefits, you damage the entire society.”he has declared.
The impact of the exemption extension is estimated to be at least R$18.4 billion in 2024.
The exemption allows companies in the beneficiary sectors to pay rates of between 1% and 4.5% on gross revenues, instead of 20% on payroll. The measure concerns sectors such as footwear, call centercivil construction, communications, clothing and apparel, among others.
Of the total value of the tax exemption, R$9.4 billion goes to private companies in 17 sectors and R$9 billion goes to covered municipalities.
On December 14, the National Congress overrode President Luiz Inácio Lula da Silva’s (PT) veto on payroll tax cuts. With the provision, the benefit for 17 sectors of the economy, which would cease to be valid on December 31, has been extended until 2027.
2023-12-28 18:45:11
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