Fiesp criticizes the reform of the Income Tax and promises to act for changes

Fiesp criticizes the reform of the Income Tax and promises to act for changes

SAO PAULO, MARCH 14, 2012, Images of Avenida Paulista, FIESP building, pedestrians from different angles. (PHOTOS: JULIA MORAES)

The Federation of Industries of the State of São Paulo (Fiesp) criticized the so-called reform of the Income Tax, whose voting was completed this Thursday (2) in the Chamber.

In a statement, the federation led by Paulo Skaf says that the proposal especially harms medium-sized companiesand promised to act for changes in the text, which will still be analyzed by senators.

As we have shown, lawmakers approved a highlight, presented by Republicans, which reduces the taxation of profits and dividends from 20% to 15%. Stock investment funds are left out. In the previous version, the rate was 5.88% for funds. The Corporate Income Tax (IRPJ) will be reduced from 15% to 8% if the proposal goes through the Senate. In the previous version, the reduction would be to 6.5%.

Read in full:

“The text of PL 2,337, which reforms the Income Tax, approved by the Chamber of Deputies, needs to be improved. Some segments, especially the medium-sized companies will be harmed, which is unacceptable at this time when we need to stimulate economic recovery and job creation. Among the points that need improvement, we highlight:

# A distribution of profits accrued up to 12/31/21 cannot be taxed in the new system, as profits they were generated when there was no tax on dividends and companies paid 34% of taxes on profits.

# The average presumed profit companies, with revenues exceeding R$ 4.8 million are being penalized because in many cases the reduction in income taxes is lower than the tax on dividends. These companies will also have to pay more taxes with the proposed unification of PIS/Cofins. Today, they pay 3.65% on sales.

# The increase from 4% to 5.5% of the CFEM (Financial Compensation for Mineral Exploration) – consideration paid by mining companies to the Federal Government, States and Municipalities by the use of mineral resources from their respective territories – will impact the prices of inputs from the base of industrial chains, such as iron ore, nickel and copper. With that, the increases will be transferred to the production chains, reaching the consumer.

Fiesp will act strongly for the necessary changes in the Senate, promoting the necessary agreement so that the Chamber maintains the advances for the benefit of the entire society.”

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