Income Tax Reform (IR) creates moral embarrassment for the country, forcing a discussion in society about tax inequality, said Finance Minister Fernando Haddad. In an interview with the program Uncertaintyfrom the TV Brazilthe minister said that the Project sent to Congress About a month has been based on social justice.
For the minister, the search to reduce social inequalities by paying taxes by the richest leaves opponents without argument to counteract income tax reform.
“I believe we have created moral embarrassment in the country. What is being said? What is wrong? We are in the mood. Can you improve? Obviously! Do you have a better idea? So far it has not appeared,” Haddad said, saying the government is open to contributions that improve the project.
In Haddad’s assessment, the moral embarrassment of being portrayed as an advocate of inequality has even inhibited the proliferation of fake news about changes in income tax. Even because the proposal has a zero fiscal impact and will not make the government raise more, it will only redistribute income.
“When you put something on the table, the first thing that happens on the side is the guy saying, ‘How can I lie to the population?’ And everyone was: ‘What do we do with this project?’ Nor fake news They are managing to do, ”added the minister.
Fernando Haddad participates in the Program Uncensored, which also receives pianist Francis Hime, psychiatrist Higor Caldato and journalist Muka. Photo – Fernando Frazão/Agência Brasil
Ride
The minister compared the taxation of the super rich with the case of the resident of a coverage that does not pay condominium. “I would say that [a lógica do projeto] It is the one who earns a lot, starts to pay something, for us to dishonor who earns up to $ 5,000. Up upstairs, on the roof, it will not hurt if the guy starts paying a condominium, ”said Haddad, answering if the logic of the reform would be to tax more who earns the most and dishonor who earns less.
The government proposes the exemption to go to 10 million Brazilians who earn up to $ 5,000 per month and the increase of discount to 5 million that receive between $ 5,000 and $ 7,000. In return, it intends to increase the IR for those who earn from R $ 50 thousand per month (R $ 600 thousand per year) and introduce a minimum rate of 10% for those who receive R $ 100 thousand per month (R $ 1.2 million per year).
Currently, about 141,000 people who receive from R $ 50,000 per month pay only 2% of effective income tax rate. This is because most of the surface income comes from dividends, exempt from taxation, or masked with income of legal entities.
Fourteenth salary
Haddad presented statistics on the inequality of the Brazilian tax system. The minister stressed that, in some professions, such as the public school teacher and the policeman who earn up to $ 5,000, the exemption will equivalent in practice to a thirteenth salary.
“Those who earn $ 1 million up pay 2% of rate. The Brazilian tax system is considered one of the ten worst in the world. Let’s agree that who earns $ 1 million a year in Brazil are the super rich. Legal he wins. His merit, his talent. But he doesn’t pay even 2% of income tax, against a policeman and a teacher who pays it,” said the minister.
Government program
For the minister, income tax reform aims to reduce historical inequalities in Brazil. “This project has one foundation: seeking social justice. We do not want to raise one more penny, one penny less. We want to look for something that this country takes time to conquer. Until the abolition of slavery in Brazil was late. We were the last country to abolish slavery,” he said.
Haddad recalled that then -president -elect Luiz Inacio Lula da Silva invited him to be Finance Minister in November 2022, during the 27th United Nations Conference on Climate Change (COP 27) in Egypt. At the time, Haddad explained that he would only accept the position if Lula agreed with historical platforms of the Brazilian left, such as tax collection on the richest and the review of tax benefits to large companies that increase inequalities.
“I will redeem the floor of education and health, put the rich in income tax, as you said in the campaign, has a company with benefit that does nothing for the country, we will have to face these guys. From there, we were building what would be economic policy,” said Haddad in the interview.
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