Corporate Tax

Brazil will vote on tax reform subsequent week

BRASILIA, July 28 (Reuters) – Brazil’s House of Commons is expected to vote on tax reform next week, with the bill likely to be amended to exclude income and dividend taxes on certain small businesses, senior lawmakers who led the process said on Wednesday.

Vote on the stage of the draft law to simplify and reduce staff; Income taxes and levies on corporate profits will be incurred when Congress returns from hiatus next week, spokesman Arthur Lira told GloboNews.

In Brasilia, Deputy Celso Sabino, the sponsor of the bill in the House of Commons, said small businesses registered with the “Simples” tax regime are likely to be exempt from paying taxes on profits and dividends.

He added that there was a “strong possibility” that the 20,000 reais ($ 3,883) monthly threshold above which companies must pay a 20% dividend tax could be lowered. The Ministry of Economic Affairs only proposed this threshold and rate last month.

Sabino said he will meet with representatives of the city’s mayors and state governors in the coming days to discuss the proposals and include “triggers” in the bill to ensure local authorities do not lose money from the reforms suffer.

“We are very close to a text that is ready to be voted on,” said Sabino after a meeting with Economics Minister Paulo Guedes.

Last month, the Brazilian government tabled proposals to cut income tax for up to 30 million workers, cut corporate profits tax and increase taxes on financial market profits. Brazil’s tax system is considered to be one of the most complex in the world. Continue reading

Reporting by Lisandra Paraguassu and Isabel Versiani Writing by Ana Mano and Jamie McGeever Editing by Jonathan Oatis and Marguerita Choy

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