By Adriana Fernandes, The State of S. Paulo (Economy) - 03/12/2004

BRASÍLIA - As of 2005, approximately 10 thousand companies with annual net sales exceeding R $ 80 million, will be required by the Federal Revenue to deliver the Declaration of Federal Tax Debts and Credits (DCTF) monthly. A kind of current account of companies with the Tax Authorities, the DCTF is presented quarterly today by all companies to inform the amounts due and paid of nine federal taxes and contributions. The other companies, which invoice less than R $ 80 million per year, will have an extended delivery period from three to six months.
The change was announced yesterday by the Federal Revenue Secretary, Jorge Rachid, at the international seminar “The New Brazilian Tax Administration”, held at the Chamber of Deputies. Rachid explained that the reduction of the term for large Brazilian companies will make the control of the Revenue more efficient.

The payment of taxes by this group of 10 companies, he said, represents 80% of all revenue collected. Smaller companies will have less labor and costs. "An accountant who makes four statements during the year will now make two," said Rachid.

According to him, with the monthly delivery, the Revenue will be able to point out any errors more quickly, which can be corrected. Some errors are frequent and responsible for numerous tax subpoenas issued by the IRS. “With digital certification, companies will be able to monitor the effective fulfillment of their obligations over the internet, avoiding corrections that lead to improper actions.”

Electronic certification is a form of identification that allows its bearer to have their internet communications recognized and identified. The company that fails to present the DCTF will have to pay 2% per month of fine on the amount of taxes informed in the declaration.

Income tax

At the seminar, the secretary spoke about the advances in the Revenue's administrative machinery, but avoided giving details about the studies for changes in the Individual Income Tax (IRPF) table. Less than a month before the end of the year, Rachid reported yesterday that the IRS has not yet forwarded the options considered to the Minister of Finance, Antonio Palocci.

"We are studying alternatives to meet expectations and due costs." According to the secretary, it is necessary to find a correct and fair way to change the table. To take effect next year, the amendments must be approved by Congress by December 31.

The Planalto Palace has pressured the Ministry of Finance to grant a correction that can compensate for the variation in inflation over the past two years. Palocci's team, however, resists the idea, and proposes a minor correction, fearing the effect of the measure on revenue.