Source: Gazeta Mercantil, 16/08/2005

By Viviane Monteiro

São Paulo, August 16, 2005 - The governor of São Paulo, Geraldo Alckmin, said yesterday that there is room for the approval of the tax reform this year, despite the turbulent political climate. According to the governor, "the topic has already been widely discussed and the text (which is being processed by the National Congress) is well advanced". The reform aims, mainly, to unify the state rates of the Tax on Circulation of Goods and Services (ICMS).

Alckmin participated in the seminar “Tax Evasion and Burden: Is there a balance point?”, Which took place in São Paulo and promoted by the Brazilian Institute of Ethics in Competition (Etco). Yesterday's debate was based on a study by GVconsult, from Fundação Getúlio Vargas, called “Macroeconomic, Regional and Sectoral Impacts of Tax Reform.

According to Etco's president, Emerson Kapaz, the bill that is being processed in Congress tends to increase the ICMS rate even more, which should harm the economy. "The objective of the work is to make society and the government aware that there is no room to further increase the tax burden," he said.

For Alckmin, the ideal would be to carry out a tax reform simultaneously, so that the issues of expenses and revenues are also addressed. “The tax reform only discusses taxes and the proposed reform only discusses one tax, the ICMS”.

For the governor of Rio Grande do Sul (PMDB), Germano Rigotto, who also participated in the seminar, "the unification of the ICMS depends on political will, which has not happened so far".