BRAZIL

On May 12, the Tax Reform Joint Committee approved the final report presented by Aguinaldo Ribeiro (PP) with proposals for significant modifications to the tax system. With this approval, the Committee concluded its work. To continue with its legislative procedure, the report must be analyzed by the Senate’s technical committees.

The main modification included in the initiative is the substitution of 5 taxes and the creation of a new one: the Goods and Services Tax (IBS). At the same time, the creation of a complementary tax, called “Selective Tax”, which will be applied on imports, was incorporated.

Regarding the treatment of the initiative, the senator and president of the Joint Committee Roberto Rocha (Brazilian Social Democracy Party) mentioned that the drafting of the report was not an “easy” task. In turn, he considered: “Surely this is the most important work for the Brazilian people, since the current system is very perverse, unfair and unequal, in the face of a tax burden close to 35%”.