The president of the Senate, Renan Calheiros (PMDB-AL), delivered on Monday (10) to ministers Joaquim Levy (Finance) and Nelson Barbosa (Planning) a series of proposals to try to stimulate the economy. The pededebista, who has moved away from the Planalto Palace since he was investigated by Operation Lava Jato, classified the situation in the country as “dramatic”.
In an article published on August 13 by the Folha de S. Paulo newspaper, columnist and economist Monica Bolle raised an interesting question about the economic crisis: What is fiscal adjustment? According to a study revealed by the columnist, more than half of the lower class population does not know what fiscal adjustment means, although they have heard about it. Even so, everyone knew how to answer what they do to save in times of crisis: they cut spending. Asked if the government did the same as they did in times of crisis, almost all responded that the government "takes care of the worker" or "steals money". According to Monica, if the population had more information on fiscal adjustment, they would have a different view of the government.
One of the main international risk rating agencies, Standard & Poor's, maintained the credit concept of the Brazilian economy in its most recent assessment, however with a downward bias, warning that the country could be downgraded in the coming months, if there is no progress in public finances. In the technical language of these agencies, Brazil has left stable (when there is little possibility of downgrade) to a negative perspective (more likely).
Senate approves proposal that regularizes the past of tax incentives in the country; understand what is at stake and the next steps of this project
On the 7th of April, the Senate plenary approved a complementary Bill (PLS 130/2014) that reduces the legal uncertainty surrounding the tax incentives granted by several states to attract investments. It regularizes the situation of companies benefiting from a reduction in ICMS. The project was sent to the Chamber of Deputies (PLP 54/2015). The procedure in Congress is essential so that the solution does not occur through the Judiciary. To end the fiscal war, other complementary measures are needed and the States, through Confaz, continue to negotiate.
The need for fiscal adjustment will cause the government to change the bill that expands the coverage of Simples Nacional in order to avoid loss of revenue. According to the Minister of Micro and Small Business (MMPE), Guilherme Afif Domingos, there will be a fine-tuning in the process so that the conditions for entrepreneurs improve, without budgetary impact. "The Federal Revenue Service is extremely concerned with avoiding the impact of exemptions," he said.
The government is considering presenting a substitute for the bill that is being processed in the Chamber of Deputies until March 19. It will propose a more modest increase in the annual revenue cap for industries that want to join the program. The current R $ 3,6 million would go to R $ 7,2 million and not R $ 14,4 million from the current text. The MMPE minister admits that the exemptions are hampered by the need for fiscal adjustment, but stresses that without it, there will be no resumption of growth.
Afif did not detail other changes under study, nor did he estimate the loss of potential revenue from the ongoing project. The minister believes that the approval of the project is not threatened by the government's disagreement with the allied base. According to him, the Micro and Small Business Front should have more than 300 congressmen. “Today the Congress is touched by dissent. If there is a consensus, it is this. ”
The Minister of Finance, Joaquim Levy, was at the beginning of February at the National Council for Farm Policy (Confaz). In explaining to the state finance secretaries what the government's objectives are this year, that is, to spend less and collect more, the minister recommended that the states do their part to contribute to the fiscal adjustment.
Levy pointed out that the lack of rules for tax incentives granted by the states creates legal uncertainty, hindering the recovery of confidence and the resumption of growth. According to the minister, the government will support a consensus in relation to the validation of the incentives already granted, which is decisive to remove the legal uncertainty resulting from changes in tax incentive policies.
Some governors have already anticipated the minister's request. In Mato Grosso, a working group formed by representatives of the Secretariats for Economic Development (Sedec) and Finance (Sefaz) and the State Comptroller General was created to audit the tax incentives granted. The conclusions of the investigations are expected to be announced in April.
Mato Grosso also created another working group, formed by representatives of Sedec, Sefaz and the Secretariat of Planning (Seplan) to study a new policy model to attract investments. According to the secretary of Economic Development, Seneri Paludo, "the important thing is to create a new policy to attract investments and not just a policy of fiscal incentive".
Amid the discussion about rules for tax incentives and tax collection, the government of Espírito Santo estimated that it will stop collecting about R $ 1 billion this year because of the tax waiver of the companies being taxed. The new secretary of Finance, Ana Paula Vescovi, has reiterated the need for fiscal adjustment measures. Among the measures discussed are cutting public funds, reducing the transfer of funds to city halls and even increasing taxes.
The governor of Rio de Janeiro, Luiz Fernando Pezão, stated at the end of January that he “intends to suspend the tax benefits granted to the Petrochemical Complex of the State of Rio de Janeiro (Comperj), which benefit Petrobras. With these benefits, Petrobras collected R $ 2014 million less in ICMS in 400 than in 2013. “We cannot live without these resources. They are fundamental for the collection of the State ”, affirmed Pezão.
This is the time to deepen the national discussion on taxes and incentives, which have already served the purpose of attracting investments, and it is expected that Congress, on the return from recess, will advance in the negotiations for the reform of the ICMS. The proposal under evaluation provides for a gradual reduction in interstate ICMS rates, over a period of eight years. "The country needs this agreement," said recently the coordinator of Confaz and Secretary of Finance of Pará, José Tostes Neto. “The worst scenario would be to leave the binding summary of the Federal Supreme Court (STF) before the agreement.”
Document sent by the government on Thursday (4) to the National Congress revised downwards the estimate of growth of the Brazilian economy in 2015, from 2% to 0,8%, and fixed the primary surplus target at R $ 66,3 billion. - the savings made to pay interest on the public debt and try to maintain its downward trend - in the public sector.
The review was carried out by the Ministry of Planning, Budget and Management, updating the proposal for the primary result goal, of the Budget Guidelines law (PLDO).
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