House leaders meet at night to set economic agenda

Lira announced the anticipation on social networks on Friday (30), after meeting with the Minister of Finance, Fernando Haddad. Since mid-June, the president of the Chamber has announced for the week a concentrated effort to vote on broad economic agendas, such as tax reform, the fiscal framework and changes in the Administrative Council of Tax Appeals (Carf).

Another topic that can be voted on by deputies is the recreation of the Food Acquisition Program (PPA). “There’s a heavy schedule next week. A lot to decide, but the intention is to vote everything”, said Haddad after the meeting with Lira. An extraordinary deliberation session has already been convened for 4 pm on Monday (3).

The first topic to be voted on should be the proposal for the return of casting vote at Carf, an issue to which the government gave urgency and which is currently blocking the agenda of the plenary. The measure is considered a priority by the economic team, as it paves the way for favorable tiebreakers for public coffers in tax disputes.

On Friday (30), Haddad said he believed the Chamber would respect a agreement made between the government and the Brazilian Bar Association (OAB) on the matter. By understanding, companies defeated by the government’s tiebreaking vote would be exempt from the fine, paying only the principal debt and interest. If the company pays the debt within 90 days, the interest will also be cancelled.

Tax framework

Once the agenda is released, the prediction made by Lira and the government is that the basic text of the tax framework. The proposal had already been approved in May by deputies, but will need to be voted on again because the government managed to make changes in the Senate, including new exemptions to the spending limit.

Among the changes is the exclusion of expenses with the Constitutional Fund of the Federal District (FCDF), the complementation of the Fund for the Maintenance and Development of Basic Education and the Valorization of Education Professionals (Fundeb) and expenses with science, technology and innovation .

A quick processing of the framework is considered crucial by the government, as it gives predictability and greater confidence to the market on the evolution of public spending. The expectation of the economic team is that the measure will help accelerate a possible reduction in interest rates by the Central Bank and put the country on an economic heating path.

Tax reform

There is the expectation that the plenary of the Chamber can start voting on a first stage of the tax reform, whose opinion was presented at the end of June by the rapporteur, deputy Aguinaldo Ribeiro (PP-PB), after more than four months of discussion.

The main change foreseen in the report will be the extinction of five taxes: three federal; the Tax on the Circulation of Goods and Services (ICMS), administered by the states; and the Tax on Services (ISS), collected by municipalities. In exchange, a dual Value Added Tax (VAT) will be created, divided into two parts. The Tax on Goods and Services (IBS) will unify ICMS and ISS. The Contribution on Goods and Services (CBS) will be collected by the Union.

However, there is resistance from state finance secretaries, some of whom met with Ribeiro last Thursday (29). One of the demands is the increase from R$ 40 billion to R$ 75 billion in the Regional Development Fund, which should be created to compensate for the end of the fiscal war between the units of the Federation.