At least part of the excess revenue resulting from the recovery of the economy can be used to correct the table of the Individual Income Tax, said today (7) the Minister of Economy, Paulo Guedes. In an event promoted by Banco Bradesco, he also promised a new reduction in the Import Tax.
“We discussed whether to correct the IR table now or leave it for the first action of the new government. We don’t want to use up all the high revenue at once. We will only return part so we do not run fiscal risks”, declared the minister during the virtual conference.
According to the minister, the economic team would also like to use the improved collection to finance the renegotiation of Simples Nacional debts and the exemption for foreign investors. He, however, said that the change of economic measures by the political wing of the government does not always make these measures viable.
“They keep the good part of the measures and remove the bad part, which is the source of funds. As a result, we ended up having to veto measures for hitting the government head on,” Guedes explained.
IPI
Regarding the exemption of imports, the minister said that the government intends to promote a new round of reduction of 10% in the Import Tax, but stressed that the measure depends on an agreement for the additional cut that will make the discount on the Tax on Industrialized Products ( IPI) increase from 25% to 33%.
According to the minister, 12 products should be covered by the reduction of import tariffs. “We are going to open up the economy respecting our industrial park. If the other government is Social Democrat, let him raise taxes. For the next term, the priority is tax reform on the first day of work,” he explained.
At the beginning of the month, the government extended, for 30 days, the cut of 25% in the IPI. According to Guedes, the economic team wanted to raise the reduction to 33%, but the measure was stopped because the governors did not agree to reduce the Tax on the Circulation of Goods and Services (ICMS) on diesel.
“The governors did not reduce the ICMS on diesel, as they have committed to reduce. We zeroed the diesel tax on our side and the governors did not do it on their side,” he said.
strikes
Regarding pressure from the federal civil service for salary increases, Guedes said that the idea is populist. According to him, granting any readjustment at a time when the country is still recovering from the economic crisis generated by the covid-19 pandemic will bring more costs to future generations.
“If everyone starts to give adjustments, we are pushing the cost to children and grandchildren”, he declared. In the minister’s assessment, the replacement of inflation losses cannot be done at this time because the “world has lived a war” against the new coronavirus.
