Tax simplification

In recent years, Brazil has taken measures to simplify the tax system. The institution of the individual microentrepreneur is one of the most recent. While these measures are being announced, the debate on tax reform continues. The year 2012 may mark the intensification of this discussion, depending on the international economic situation.

At the end of last year, President Dilma Roussef stated that she intends to slice the tax reform proposal. This provision may open the door to the adoption of new measures to simplify the system, with more tangible and immediate results than a comprehensive reform. Renowned economists, lawyers and tax lawyers advocate specific simplification actions, especially in the face of possible international economic uncertainties.

Former Finance Secretary Everardo Maciel, for example, recalls that tax complexity is costly, inefficient, controversial and paves the way for bureaucracy, corruption and tax evasion. “Nowhere in the world is there a 'tax reform'. Sudden and far-reaching changes are only feasible, although not necessarily desirable, in conditions of institutional disruption ”, says Everardo. For him, "continuous changes, focused on specific problems and forwarded through the infra-constitutional route" are preferable.

This is the path that has been taken, even if in an unplanned way, at the national level. In the mid-1990s, for example, a reform of the Income Tax was made, making the calculation of corporate taxes simpler. "The results tend to be more efficient when the interests of the tax authorities and taxpayers are reconciled," says Everardo.

ETCO Chief Executive Roberto Abdenur highlights another aspect. “The bureaucracy for calculating and collecting taxes is just as excessive as the tax burden.” Even with measures to simplify the system, recalls Abdenur, one should not forget to facilitate the means of paying taxes, encouraging all taxpayers to effectively contribute to the country's economy and development.