Deputies expand criticism of points in the tax package

Deputies expand criticism of points in the tax package

Parliamentarians linked to the business sector complain about limited tax credits; change in Fundeb generates discord

By Raphael Di Cunto and Rafael Walendorff — From Brasília

In addition to political dissatisfaction, the fiscal adjustment package presented by the Lula (PT) government is the target of criticism from parliamentarians linked to the business sector, those elected by the Federal District and the education bench. Apart from the attacks on the containment of the growth of the minimum wage and the tightening of the rules of Bolsa Família, Continuous Payment Benefits (BPC) and the salary bonus by the left itself.

The main complaint from companies is the proposal to limit the compensation of tax credits. One of the bills allows the government to enact an ordinance to require the payment in installments, over at least 60 months (five years), of the rebate on credits exceeding R$10 million to which companies are entitled, if they had registered a primary deficit in the previous year – that is, they had not raised enough resources to pay their primary expenses.

Compensation is used by companies to help with their cash flow. Instead of requesting a refund of taxes in cash, they can use these credits to offset the taxes they owe. Credits can be obtained by judicial decision (when contesting the collection of a tax) or administrative, such as having paid too much tax.

President of the Parliamentary Agricultural Front (FPA), deputy Pedro Lupion (PP-PR), criticized the measure. "[Exporters, fertilizers, meat, pesticides, agricultural inputs as a whole will be affected. Today there is no way to maintain the competitiveness of Brazilian agriculture if we cannot take advantage of the use of credits or have some type of tax differentiation on these issues, especially imports of inputs on which we are dependent", he stated.

The government already managed, last year, to pay in installments for the compensation of tax credits obtained by court decision. A provisional measure (MP) was approved with this objective by Congress. But this version was smoother, with a higher graduation. Debts of less than R$100 million, for example, are paid in 12 months and not in the 60 currently proposed. And the MP is only valid for resources obtained in disputes in the Judiciary – a reaction to the “thesis of the century”, which excluded ICMS from the PIS/Cofins calculation base and led to a reduction of R$ 100 billion per year. In the new version, all types of credits will be affected.

Lawyer Eduardo Lourenço points out that the bill “goes beyond the MP”. "He says that, if the government spends too much, it could prevent any compensation of taxes administered by the Federal Revenue of Brazil. It is something that directly affects the very idea of non-cumulative activity and, at the end of the day, goes against the very idea of tax reform."

For lawyer Roberto Duque Estrada, the measure constitutes a “default”. "It's very common for the company to make a mistake in a certain INSS payment, correct it and get a credit to compensate. It happens a lot, it's very frequent. Or the Supreme Court [Federal Court] recognizes that a tax is undue and I ask for reimbursement without having to go to court. Now they want to split these credits, tell me how I should allocate my money."

The presentation made by the government to the parties did not include this measure. The tax gain was also not detailed. At the time of the MP, the government argued that it was necessary to have predictability for the public budget.

Another measure causing resistance is the proposed constitutional amendment (PEC) that requires 20% of the resources from the Basic Education Valorization Fund (Fundeb) to be allocated to comprehensive education. As a result, the government must reduce spending by the Ministry of Education (MEC) on this type of investment. The estimate is to save R$4.8 billion in 2025 and R$5.5 billion in 2026.

President of the Parliamentary Front for Education, deputy Rafael Brito (MDB-AL) says that this should open up space for the Pé de Meia program, a “savings” program for low-income high school students, to be incorporated into the MEC Budget, but that it will end with encouraging investments in the expansion of full-time education.

"Today the ministry makes a contribution of around R$7 billion per year to open full-time education places. Without this stimulus, I don't believe they will close the existing places, but we won't have any new places", says Brito. "Nobody wants to get in the way of the government's spending cuts, but we want to sit down to discuss whether there are alternatives. Fundeb has no money left over, and 70% of the resources are to pay salaries."

The Federal District bench, with just eight deputies and three senators, also intends to act to avoid changing the calculation rule for the Constitutional Fund of the Federal District, created in 2002 to pay for public security and public health in the country's capital. The government wants resources to be updated only by inflation from now on, without the real growth of recent years. The local government says the change will take away R$12 billion by 2030.

Coordinator of the Federal District bench in Congress, deputy Rafael Prudente (MDB) says he expects a discussion to follow the normal procedure, “without fuss”. “There is nothing that can be changed in legislation that worked so well”, he states. The reduction in the fund's resources was already approved by the Chamber last year, but was rejected by the Senate and also by deputies in a second analysis.

https://valor.globo.com/politica/noticia/2024/12/04/deputados-ampliam-criticas-a-pontos-do-pacote-fiscal.ghtml