Market is going to promote investments anticipating gains brought by reform, Roberto Campos Neto tells lawmakers
06/30/2023
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Roberto Campos Neto — Foto: Edilson Rodrigues/Agência Senado
Central Bank President Roberto Campos Neto told lawmakers that the approval of the tax overhaul will cause an immediate increase of 1% to 1.5% of the GDP in the following year because the market will promote investments anticipating the benefits of the reform, although the simplification will not come into force until two or three years later for federal taxes and only after 2029 for sales tax ICMS and Services Tax (ISS), sources told Valor.
This figure was mentioned in the round of talks among federal deputies to convince them to pass the bill. Chamber of Deputies Speaker Arthur Lira and Deputy Aguinaldo Ribeiro, the rapporteur of the matter, will hold several meetings starting this Friday to adjust the necessary points to try and pass the proposal in a floor vote next week. Rumor has it the afternoon committees may be canceled to devote full attention to the matter.
The perception of the negotiators of the overhaul is that the approval in the Chamber of Deputies will force the Senate to analyze it in the second half of the year. Although senators are more susceptible to pressure from governors and states that still oppose the bill, deputies believe they will not be able to hold back such an important issue if it has already passed the first stage, which is the vote in the Chamber.
The text, deputies believe, is different from the income tax reform, which aimed to fulfill an election campaign of former President Jair Bolsonaro to increase the income tax exemption range, but was not considered essential for the development of the country. At the time, there were no major objections when the Senate decided to halt the proposal passed by the Chamber of Deputies (also because of the perception that it created new distortions).
Moreover, since this is a proposal to amend the Constitution (PEC), the changes made by the senators in the tax reform will have to be taken into account by the Chamber of Deputies, since the PEC will only be enacted if there is a consensus between the two houses.
*Por Raphael Di Cunto, Marcelo Ribeiro — Brasília
Source: Valor International