Source: The State of S. Paulo (São Paulo - SP) - 04/06/2012

The federal government did well when it abdicated from presenting comprehensive tax reform proposals, preferring solutions focused on specific problems. Experience clearly demonstrates that these types of reforms lead to the maximization of political tensions, resulting in the failure of the claim. Complete restructuring of tax systems only occurs in exceptional situations, such as acute crises, institutional disruptions or wars.

Everaldo Maciel - Tax consultant, was Secretary of Federal Revenue (1995-2002)

The rejection of comprehensive fundamentalism cannot, however, mean the triumph of casuistic reforms, resulting from responses to circumstantial problems or from concessions to less virtuous lobbies.

The casuistic reforms generate a risky climate of tax voluntarism, in which the tax becomes a solution to all problems, without realizing that it can become a problem for all solutions.

Therefore, there is no free extra-tax exercise. Precisely for this reason, the doctrine enshrined neutrality as one of the basic principles of tax policy, although subject to articulation with other equally relevant principles. If the intransigence regarding the use of tax incentives represents a dogmatism of little use, the abuse in the use of this institute is a territory of complexity, where tax evasion, illicit planning and, almost always, corruption prosper.

By replacing the payroll with gross revenue, on the basis of calculating the employer's social security contribution, the tax authority took a wise step in order to relieve exports and overcome the antagonism between employment and tax.

It was also prudent to restrict the change to those sectors where the payroll had a significant weight in the respective costs. This prudence is justified, because the effects of a new tax model are never completely predictable. The tax authority erred, however, when it admitted the coexistence, in the same company, between the new and the old regime, resulting in a complex and vulnerable tax syncretism.

The enormous instability in tax rules is extremely damaging. By mere common sense, it is known that economic uncertainties cannot sanction complete tax unpredictability, just as the duty to react to what is adverse does not authorize temerity.

With each increase in the stock of automobiles in the car parks, it seems unreasonable to create transitional regimes, with a lower Tax on Industrialized Products (IPI). This policy is capable of generating important perverse effects. It was she who, combined with a careless credit policy, made traffic in our cities unfeasible, as it is undeniable that the Brazilian urban fabric is not designed to receive a large number of cars, not to mention the recognized precariousness of public transport.

In the case of the city of São Paulo, in the face of constant traffic jams, a good-natured observer suggested replacing the IPVA tax on vehicles with the one on real estate.

The return to normal car taxation causes paralysis in the market, waiting for a further reduction in the IPI. Something similar to what happens with some taxpayers who opt for default in the hope of future amnesties.

The Tax on Financial Operations (IOF) changes from time to time. The only certainty, then, is that it always changes. It is evident that it has a regulatory function, in spite of its growing collection role. But this function cannot be used as an excuse for its conversion into an airport windsock.

PIS and Cofins have become a stick for every project. For each project conceived by a luminary on duty, a tax benefit regime is created for those contributions. Such regimes are associated with requirements, for which the public administration is not qualified to verify compliance. Usually, they are extinguished due to scandals.

Today, neither the tax authorities nor the taxpayer are aware of the PIS and Cofins legislation. It is a patchwork quilt that does not fit in a regulation.

In order to face circumstantial problems, the PIS / Cofins maturity was postponed for some sectors (textiles, leather, shoes, furniture, auto parts), from April and May to November and December next. A dangerous precedent has been set.

It is true that, for many reasons, those sectors are in crisis. What does it mean, however, to understand that, at the end of the year, they will overcome the crisis and be able to pay past and current taxes? A window for remission or further extension is already foreseen.

Furthermore, with what authority can the benefit be denied, at another time, for the same or other sectors in crisis? All of this is reminiscent of the sad times when the date of delivery of the Income Tax was not known.

Problem-centered tax policies can be correct and realistic, and please the beneficiaries. However, they run a serious risk of raising the level of uncertainty or subjecting decisions to imperial preferences of the government.