On March 24th 2011, through a Presidential Decree, the government increased
from 2.38% to absurd 6.38% the IOF aliquots - Financial Transactions Tax,
required on overseas credit card purchases.
The Federal Government says it has implanted a Fiscal Policy that aims on
reducing and controlling dollars outflows in products and services purchases
abroad, while safeguarding the national industry, because the Brazilian
products and services can not compete with price and quality of foreign
products. The reason is that the Brazilian products are burdened with the so
called “Brazilian cost”, a mix of inefficiency in governmental investments
versus high tax burden.
The proposal could not be better, unless if it was actually true!
The governmental concern has nothing to do with the protection of the
Brazilian industry, products, services or fiscal intelligence. Truth be said,
the recently elected president Dilma Rousseff found herself in a bad
position when pressured by the same union leaders who elected her to correct
the rate of the Income Tax Withheld at Source (ITWS). The President, with
the requirement of Trade Unions, amended the exemption range of the ITWS
from R$ 1,499.15 to R$ 1,566.61. So mostly workers associated to the labor
unions which give opinions and suggestions to the government are exempt from
paying this Income Tax. Such benefit, fair or not, will cost to the public
safe not less than R$ 1,6 billion only in the year of 2001.
Given this paradoxical reality, the Federal Government preferred tracing the
same Fiscal Policy practiced by past governments. Spend and spend, and
charge more taxes, back and forth, always leaving the debit for the
Brazilian citizens and companies. In this case, the solution was to raise at
once more than 300% in the IOF incident on abroad debts through credit cards,
raising something around R$ 1,75 bi from the taxpayers who are not favored
by the Income Tax exemption negotiated with the Unions.
The worst part of it is that this decision favored – with no warning -
nearly 10% of the accommodation budget, meals and transportation of persons
who are already traveling, whether for work, study or leisure.
This autophagic policy and the disrespect to the Brazilian people reveals
just how delicate the situation of the government accounts is.
There is huge a huge imbalance between the official forecast of revenue and
size of government spending, whose numbers were increased by excessive
spending of the previous Government, which added the debt until the year
2010 in amounts exceeding US$ 200 billion.
For no other reason, the Executive Director of Standard & Poor's from
Brasil, Milena Zaniboni, said that if Brazil fails to meet the primary
surplus target of this year, equivalent to 2,9% of the GDP, “there could be
a lowering” of the perspective or the grade credit rating, affecting the
current grading scale ranking of investment grade (BBB-).
It’s only possible to face the high expenditure left from the previous
Government with economical growth. Otherwise, how is it viable to pay the
public debt gained during the second half of 2010 by issuing government
bonds worth US$ 202 billion? The resources obtained with such billionaire
loan were transferred, mostly, to BNDES (who passed almost the whole amount
to the increase of participation from the Petrobras Union), to the Northeast
Bank, to the Merchant Marine Fund and to Caixa Econômica Federal. This
emission of titles by itself corresponded to 12% of the GPD, making the
national public debt go up which, according to data from the Central Bank,
was already over 64% of the GPD, corresponding to US$ 912 bi more, which
cost goes over US$ 333 mi in interests “daily”.
This fiscal imbalance is not possible to be fixed through a simple raise of
taxes, even because the inner transactions are taxed in almost 65%, average.
Only by reducing the inner public debt interests and cutting the waste in
public spending there will be fiscal balance and resources to feasible
economical growth leading to increase revenues by scale.
Otherwise, this back and forth policy adds to the deceleration of all
economy, affecting Stock Exchanges Market and with that taking Brazil out of
the comfortable situation that the global market has given it today, but now
– when the world crisis of 2008 seems to be over – starts to be questioned.
Édison Freitas de Siqueira
Presidente do Instituto de Estudos dos Direitos dos Contribuintes
www.direitosdocontribuinte.com.br
efs_artigo@edisonsiqueira.com.br
Leia esta matéria em português.
