Source: Folha de S. Paulo, 08/05/2008

The advance collection of ICMS for some sectors is not a reason to change price lists, says Otavio Fineis Junior, coordinator of Tax Administration at the São Paulo Finance Department. "Anyone who uses the change in the billing system as a justification for raising prices is being opportunistic."

Fineis Junior says that the system called tax substitution has not changed the basis for calculating the tax. “What has changed is that the tax is now collected by the manufacturer based on the price sold to the final consumer. We just shift the moment of tax collection ”, he says.

The advance payment of the ICMS, that is, the payment of the tax by the manufacturer, has been taking place for more than ten years, according to Fineis Junior, in the case of products such as automobiles, beers, soft drinks, ice cream, cement and fuels.

“Our objective, when expanding the system to other sectors, is to avoid tax evasion in retail, a critical sector. Therefore, collecting the tax in the industry is much easier. Those who did not pay tax now will have to pay. This is the logic of tax substitution: instead of charging ICMS for 30 thousand points of sale, we are going to charge three or four factories ”, he says.

According to him, it is possible that one or another taxpayer may have problems adapting to the new ICMS collection regime. “But we are available to answer questions. This debate did not arise overnight. It has been discussed since last year with the sectors. ”

The São Paulo farm, according to him, expects to raise R $ 560 million more from ICMS this year due to the new system. (FF)