PROPOSED AMENDMENTS TO THE TAX REFORM PEC
The proposal of amendment to the Constitution - PEC 45/2019, which deals with tax reform, began to move in the House, with the reading of the report in the Constitution and Justice Commission - CCJ.
In effect, the Finance Secretaries of the 26 states and the Federal District met on May 16, 2019, and decided that they will present to the governors a proposal to amend the PEC, approved by the Committee of the Finance Secretaries of the States and the Federal District - Comsefaz, an association that brings together the 27 members of the National Council of Finance Policy - Confaz.
It is worth noting that PEC 45/2019 is based on the tax reform model advocated by the Tax Citizenship Center - CCiF, led by the former executive secretary of the Ministry of Finance Bernard Appy. The proposal unifies PIS, COFINS, IPI, ICMS and ISS into a single Value Added Tax - VAT, called Tax on Goods and Services - IBS.
It is worth noting that on May 3, 2019, the Finance Secretaries of the North and Northeast regions suggested increasing the participation of the states and municipalities in the collection with VAT, reducing the power of the Union to supervise and deliberate on the tax, limiting that tax legislation on the new tax be the initiative of the states through complementary law and restricting the tax competence of VAT to the states and municipalities.
In addition, they suggested creating a Constitutional Regional Development Fund to finance public policies, reducing the tax reform transition period from 50 to 10 years, establishing a state jurisdiction for tax executions and maintaining a differentiated and lower rate for the basic food basket.