President Luiz Inácio Lula da Silva reaffirmed today (18) that he wants to readjust the Individual Income Tax table with exemption for those earning up to R$5,000, and that he will start working on tax reform.
“Exemption and tax increase needs a law, it cannot be done by shouting, we have to build”, he said. “A lot of convincing in Congress and organization of society is needed”, said the president during a meeting with directors of trade union centrals, at the Planalto Palace.
Yesterday (17), the Minister of Finance, Fernando Haddad, stated that the government wants to vote on the proposed tax reform on income in the second half. The part focused on the impacts on consumption should be voted on in the first half.
“Today’s poor who earn R$3,000 pay proportionally more than someone who earns R$100,000. Those who earn a lot pay little because those who earn a lot receive it as dividends, as profit, to pay little income tax”, argued the president.
The lack of correction of the income tax table in recent years will mean that, in 2023, people earning a minimum wage and a half will have to pay tax for the first time. The table was last updated in 2015 and the current limit for exemption is almost R$ 1,903.98. With the minimum value at R$ 1,302, those who earn a salary and a half earn R$ 1,953, therefore above the exemption range.
The correction of the income tax table is one of the central points in the economic agenda of the new government and Lula’s campaign promise.
“I have a fight with PT economists. People say ‘if you exempt up to R$ 5 thousand, that’s 60% of that country’s collection’. So let’s change the logic, let’s decrease for the poor and increase for the rich”, said Lula.
“We don’t win this [correção da tabela] if there is no mobilization of the Brazilian people to change, once in a lifetime, the tax policy to put the poor in the Union Budget and put the rich in the income tax, to see if we collect enough to carry out social policy in this country” , completed.
