Payroll relief: government should present compensation measures this Friday

According to the Federal Revenue Service, payroll tax relief for the productive sector and municipalities results in a loss of R$25.8 billion for the Executive.

Compensation is required by the Federal Supreme Court (STF) as a condition for the continuity of the tax benefit. Initially, minister Cristiano Zanin granted an injunction in favor of the government that suspended the exemption — which would mean that companies and municipalities would have to deal with an increase in tax burden since the 20th.

Days later, the government reached an agreement with the National Congress — which is mostly in favor of the exemption — and with the economic sectors and mayors. Through the Federal Attorney General’s Office (AGU), he requested that the injunction be suspended. Minister Zanin agreed, but gave a deadline of 60 days for the Executive to present sources of resources to neutralize the loss of revenue.

Despite the agreement that exemption for companies and city halls will be guaranteed in 2024, with a gradual increase in rates between 2025 and 2028, lawyer Daniela Lopes Marcellino, partner at Elebece Consultoria Tributária, says that the scenario remains uncertain.

“According to Minister Fernando Haddad, the compensation measures will be presented by the end of this month. We are eagerly awaiting to find out what these measures will be. After these measures are approved, then we will be sure that the exemption impasse is over, but within this period we will still We will have pressure between the Legislative and the Executive, so that it works out well for both”, he assesses.

New bill is already being processed

Author of the law that extended payroll tax relief for companies and established the benefit for municipalities until the end of 2027 — a rule that was subject to an injunction from Minister Zanin —, senator Efraim Filho (União-PB) presented a new bill to pacify the issue.

The proposal establishes that the tax relief for the productive sector will continue in full until the end of this year. However, it predicts that, in 2025, companies will once again contribute 5% of their payroll; rate that increases to 10% in 2026; 15%, in 2027; until returning to the level of 20% in 2028.

The gradual resumption of taxation on municipalities is still under discussion.

AGU requests suspension of the payroll tax relief process from the Supreme Court

Minister Cristiano Zanin maintains payroll tax relief for 60 days

Understand

In force since 2012, the exemption allows companies from 17 economic sectors to exchange the social security contribution of 20% on the payroll for the payment of 1% to 4.5% on revenue. In the case of municipalities, the benefit is more recent and consists of a reduction in the contribution to the INSS from 20% to 8%.

For city halls and some companies, it is more financially advantageous to opt for taxation on revenue. The production sector claims that this reduces costs related to hiring labor and helps preserve jobs.

The government, in turn, argues that the benefit reduces revenue, which it counts on to meet its expenses.