Source: Jornal da Mídia – Salvador/BA – 07/03/2010

Salvador – Continuing the integrated actions to combat tax evasion, the State Government, through the Secretary of Finance (Sefaz), signed another agreement, this time with Minas Gerais. The states signed five protocols related to the implementation of tax substitution between the two units of the federation, which deal with the taxation of toys, bicycles, cleaning material, stationery and construction material, following the line of those already in force with the state of Sao Paulo. The protocols come into force this month, except for construction material, due to the characteristics of the segment and its specificities.

According to the Secretary of Finance, Carlos Martins, the measure reaches 20 thousand taxpayers and the commercialization of these goods generates significant values ​​for the collection of Bahia, and, in 2009, these products contributed with the amount of around R$ 200 million. .

“We expect a significant increase in this value, due to the increase in the number of taxpayers reached, with a possible reduction in evasion in retail. This measure is of great importance for the dissemination of the tax and for increasing the subjective risk incurred by those who do not fulfill their tax obligations”, explains Martins.

With the protocols, companies from Minas Gerais that send goods from these sectors to Bahia, or vice versa, will withhold and pay the Tax on Circulation of Goods and Services (ICMS) for the benefit of the recipient state under the tax substitution regime, through which the collection of the tax that would be paid in all stages of commercialization until the sale to the final consumer is transferred to the state of origin. Thus, there will be no increase in the tax burden and much less in the cost of the products to be marketed.

Martins says that the implementation of tax substitution is one of the government's great allies in the fight against tax evasion. “Tax substitution, by transferring tax collection to the source, facilitates the monitoring of tax collection and guarantees tax justice, avoiding unfair competition from companies that do not properly collect ICMS, thus making the business environment less bureaucratic and expensive”, explained Martins.