Legislative and Executive to Work on Single Tax Reform Proposal
3 enero 2020

Senate President Davi Alcolumbre (Demócratas – allied to the ruling party) has announced that tax reform will be the Chamber’s priority during the first half of 2020. However, Rodrigo Maia, president of the Chamber of Deputies (Demócratas – allied to the ruling party), said that the tax on financial transactions being driven by the Executive through the Minister of Economy, Paulo Guedes, will not be included in this bill. The Brazilian Congress is in recess from December 23 to February 3, so the debate on the reform,  which will be studied by a joint committee to draft a unified text between the two branches, will continue after that date.

After Minister Paulo Guedes stated that the government is considering including a tax on financial transactions through digital media in the tax reform, the presidents of both chambers announced that this initiative would not get the green light in Congress. “We want a reform that simplifies people’s lives (…) Rodrigo Maia has spoken, I have spoken. It is unlikely that the Senate will vote to increase the tax burden on Brazilians,” explained Alcolumbre. Maia said that “the response of the Chamber [to the financial transaction tax] is going to be no.”

The idea of the government, which so far has not presented a tax reform proposal, is now to send its proposals to a mixed committee of deputies and senators who will work on a single text combining the Legislative and the Executive’s proposals. Although the original idea was for the committee to work over the parliamentary recess, party leaders have so far been unable to agree on the members making up the committee, and the body is therefore unlikely to meet before February.