Lawmakers sneak amendment into tax reform, diluting its power
After approving the tax reform on Thursday, Brazilian House members voted on Friday on several proposals to amend the core bill. One of them was approved, allowing state governments to keep additional taxes on primary and semi-finished goods until 2043, replacing similar funds in some state governments. Otherwise, the reform mostly removes from state governments […]
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After approving the tax reform on Thursday, Brazilian House members voted on Friday on several proposals to amend the core bill.
One of them was approved, allowing state governments to keep additional taxes on primary and semi-finished goods until 2043, replacing similar funds in some state governments. Otherwise, the reform mostly removes from state governments the ability to impose different tax rates on products and services.
Congressman Aguinaldo Ribeiro, the bill’s rapporteur, said the proposal was included at the request of Goiás Governor Ronaldo Caiado and other state administrations with similar funds. The revenue from these taxes must be invested in housing and infrastructure.
The provision was included in a 35-page amendment to the tax reform, along with several other measures, such as an article extending the tax immunity already granted to temples to religious institutions and their charitable organizations.
The amendment also stipulates that the state-level tax on vehicles will be applied to private planes and boats, a long-standing demand of left-wing activists. However, tractors and planes used in agriculture will be exempt from the tax.
The House has completed voting on the tax reform bill, and the proposal will be analyzed by the Senate after the legislative recess that begins on July 17. If senators make changes to the text approved by the House, the reform will return to the lower chamber (it will go back and forth until both chambers agree on the same text).
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