Minister of Economy says the calculations were ‘too conservative’ and that he welcomed criticism from the private sector
Minister of Economics, Paulo Guedes stated on Wednesday, 14, that he was wrong in the dose of the cut in the Income Tax for Legal Entities (IRPJ) proposed by tax reform and that the collection with the taxation of dividends should support the expansion of the family allowance. The text of the reform sent by the Executive to Congress provided for two reductions of 2.5 percentage points in 2022 and 2023 in corporate taxation. The measure was changed by the bill’s rapporteur in the Chamber, Deputy Celso Sabino (PSDB-PA) to cut 10 percentage points in 2022 and another 2.5 points in 2023. “I made a mistake in the dosimetry of [reforma] tax. The important thing is to recognize the error, back off and correct it as quickly as possible,” he said. According to Guedes, the economic team’s calculations were “excessively conservative” and that it received “very well” criticism from the private sectors. “Our mentality here is not to be super-authority. What we did was listen to everyone, recalibrate the parameters and step back into things that were really wrong.” The proposals submitted by the economic team were the target of criticism by economists, representatives of the private sector and even members of the ministry itself. Days after presenting the proposal, Guedes admitted that the government was considering reviewing the expansion of the cut in corporate taxation, as long as subsidies and benefits for companies and segments of the economy were withdrawn.
Live promoted by the newspaper Value Economic, Guedes also indicated that the 20% tax collection on the distribution of profits and dividends should be used to finance the expansion of Bolsa Família. According to the minister, the budget for the income transfer program should receive R$ 20 billion more, totaling R$ 50 billion in 2022. done within the spending ceiling and respecting fiscal responsibility. “The source, in fact, is very welcome from a social point of view. Tax the super-rich and finance the tax reduction for wage earners and the strengthening of Bolsa Família.” The rapporteur’s proposal must withdraw R$ 30 billion from the IRS. According to Guedes, the value does not generate concern given the R$ 100 billion increase in this year’s collection. The minister claims that the jump in the Gross Domestic Product (GDP) in 2021 justifies this sum. “Even if the GDP grows zero from now on, this return alone means an increase in the collection of R$ 100 billion above the forecast. If we made a mistake with R$ 30 billion in the renovation, there’s no problem. It’s already paid for,” he said. The Economic Policy Secretariat (SPE) of the Ministry of Economy revised the rise of the Brazilian economy to 5.3% in 2021, according to data from the Macrofiscal Bulletin released this morning.