Valentine’s Day: research shows how tributes make gifts more expensive

Research by the Brazilian Institute of Planning and Taxation (IBPT) shows the projected tax rates for this year that impact the final price for the consumer. Imported perfume, for example, is taxed at 78.99%, and domestic perfume at 69.13%. In the case of imports, the director of the IBPT, Carlos Pinto, explained that the import tax, freight, dollarization, customs clearance and foreign trade tax also weigh, which raise the price of the product internally.

Chocolates, always remembered as a gift, are taxed at 39.61% and natural flowers at 17.71%. Personal objects, such as watches, are taxed at 56.14% and jewelry at 50.44%. If the option is for costume jewelry, taxes will be 43.36%.

In the case of books, which are not taxed at the exit, taxes reach 15.52%, because they consider factors such as production in the publishing industry, electricity, equipment, employees, freight, gasoline. Other products, such as handbags, have a tax rate that can reach 39.95% of collection. The price of gifts is higher for the consumer because the products are taxed within the country.

regressivity

A characteristic of the Brazilian tax system is this accumulation on consumption, said Carlos Pinto to Brazil Agency. “We have a tax that goes into the base of another tax, and this means that there is an extremely gross portion within a product that is related to taxation”. He considers the Brazilian taxation system antagonistic to the world system. In general, there are three sources of government revenue: income (Income Tax); assets (Tax on Ownership of Motor Vehicles, Property Tax and Urban Land Tax, Tax on Transfer of Real Estate Property-ITBI); and consumption.

When you have a high tax burden on consumption, “there is no escape for the taxpayer. Because (in the case of) a car, for example, which is equity, he can say he won’t buy it because the tax is too high. But, in general consumption, there is no way. It’s a trap, and everyone falls.” In Brazil, this tax is on the inside. That is, the consumer does not know how much he is paying.

According to Carlos Pinto, the tax system in Brazil is regressive because rich and poor pay the same tax burden on the same product. In a refrigerator that costs, for example, R$ 3 thousand, the tax burden is 60%, which means that R$ 1.8 thousand are taxes. For a worker earning the minimum wage, R$1,800 represents about 140% of his salary; those who earn BRL 10,000 pay 18% of their salary. “Brazil’s regressive system is extremely harmful,” he said.

Remodeling

For Carlos Pinto, the tax reform that is being analyzed by the government is, in fact, a simplification of taxes that affect consumption.

“Here, we are talking about Tax on Industrialized Products (IPI), Tax on Circulation of Goods and Services (ICMS), Tax on Services (ISS), Social Integration Program and Contribution for Social Security Financing (PIS/COFINS) ”. This moment demonstrates the real need for Brazil to adopt a transparent policy regarding the taxes being paid., He added.

The accumulated tax burden from the industry to the final consumer makes the product extremely expensive. And in times when the supply is greater, the price rises, the tribute rises, and the whole cascade rises. “‘It’s the ripple effect we have.”

impostometer

Founded in 1992, the Brazilian Institute of Planning and Taxation (IBPT) is dedicated to the study of the complex tax system in the country and is recognized for the use of clear and precise language to society about the Brazilian tax reality.

The IBPT calculates the direct and indirect taxes that are in the production stage.

The institute also laid foundations to make the logic of fiscal transparency viable, promoting tax awareness through projects such as the Impostômetro and De Olho no Imposto, among others. The register is updated annually or whenever the legislation changes, as occurred in the recent change in ICMS.