The Lower House approved a project that had already had half a sanction in the Senate. Products in the basic basket are exempt from taxes and those considered harmful to health are raised.
Move forward one tax reform in Brazil. The Chamber of Deputies of that country approved with modifications this Tuesday a bill that includes a key regulation to simplify the tax system promoted by the government of Lula da Silva.
The project voted in Deputies establishes a regulation that allows five consumption taxes to be merged into one: the Value Added Tax (VAT). In addition, it will be divided into a federal and a state tax.
This way, The law creates three taxes (federal, regional and municipal) on consumption that will replace the five that existed until yesterday. Now, the reference rate for the consumption tax remained at 26.5%. The reform had obtained half a sanction in the Senate last week. This Tuesday, the Chamber of Deputies also approved it, but insisted on some points of the original text.
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“The tax reform is reducing the burden by 0.7% for all Brazilians“said the deputy Reginald Lopesfrom Lula da Silva’s Workers’ Party (PT).
Tax exemption for the basic basket and higher taxes for those harmful to health
The tax reform also includes the basic basket. The project establishes the total tax exemption for foods such as meat, rice, beans and milk and for some medications.
Another aspect of the law is the creation of a new tax for products considered harmful to health. Among others, there are alcoholic and sugary drinks. This tribute had been removed by the Senate.
Argentine basket vs. Brazilian: what are the three basic foods that are most expensive in our country
The Agricultural Intercooperative Confederation Limited (CONINAGRO) made a price comparison between Argentina and Brazil and detected which foods cost more expensive in our country than in our trading partner.
Rice, milk and pork are three basic foods of the family basket which, despite having a higher price in Argentina than in Brazil, generate lower income for local producers compared to Brazilians. In this scenario, the appreciation of the Argentine peso against the Brazilian real raises concerns about the competitiveness of the food sector, one of the most relevant for the country.
Source: Ambito
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