Source: Senado Federal - DF - JORNAL DO SENADO - 18/11/2009

Taxation applied to the tobacco industry divided opinions at a public hearing held yesterday by the Economic Affairs Committee (CAE). The differences were between representatives of the Federal Revenue of Brazil (RFB) and the São Paulo State Tobacco Industry Union (Sindifumo), which took on the defense of the interests of small companies. The focus of the discord would be an alleged injustice practiced against small producers for unified taxation for the sector.

Revenue auditor Marcelo Fisch de Berredo Menezes explained that the tax on tobacco makes no distinction between companies, which can set their prices freely.

The president of Sindifumo, José Henrique Nunes Barreto, defended the approval of the project of deputy Tadeu Filippelli (PMDB-DF) that alters the rules for charging IPI on cigarettes.

Evasion

Like the revenue representative, the president of the Brazilian Institute of Ethics in Competition (ETCO), André Franco Montoro Filho, defended the fight against tax evasion in the tobacco industry, as well as administrative simplification in the sector's tax regime.

In turn, the president of the Tobacco Industry Union in Rio Grande do Sul (Sinditabaco), Iro Schünke, opposed any decision that could interfere with production in the south of the country. The president of Sinditabaco in the state of Bahia, Ricardo Becker, took the defense of the cigars and cigarillos industry.

Asked by CAE vice president, senator Delcidio Amaral (PT-MS), about legislative proposals that could bring greater competitiveness to the sector, Becker supported the return of the 15% IPI tax rate for cigars and cigarillos, while Iro Schünke did an appeal to parliamentarians to also take smokers' rights into account when analyzing projects of interest to them. Eduardo Suplicy (PT-SP) also participated in the hearing.