The “Compliance” pillar has three programs: Confia [Cooperative Tax Compliance Program], Sintonia [Tax Compliance Incentive Program] and OEA [Brazilian Authorized Economic Operator Program].
The Special Secretariat of the Federal Revenue Service presented the details of the Bill that establishes tax and customs compliance programs, provides for the habitual debtor and the conditions for the use of tax benefits. The central point of this initiative is to encourage good taxpayers and strengthen the guiding nature of the Revenue Service (leaving the punitive bias of the agency in the background). For example: among the measures provided, one of them foresees that the taxpayer well classified in the compliance criteria will have access to a reduction in the Social Contribution on Net Income rate of up to 3%, with a bonus for compliance. The text was forwarded to the National Congress in the format of a Bill with constitutional urgency.
The special secretary of the Federal Revenue Service, Robinson Barreirinhas, said that the proposal has three pillars, in the segments of “compliance”, “control of benefits” and “contumacious debtor”. The details of the measures were presented this Friday (2/2) in a press conference held at the headquarters of the Ministry of Finance, in Brasília. The changes will allow the “reorientation of the Federal Revenue Service, definitively ceasing to be a punitive Revenue Service to become a Revenue Service that guides good taxpayers. To do this, we need a change in culture, both of the tax authorities and of the taxpayer”, reinforced the secretary.
The new front of action is based on a path paved throughout 2023, referred to as the year of “structuring and recomposition”, with a series of advances such as the approval of the new fiscal framework and the tax reform on consumption; resumption of the quality vote in the Administrative Council of Tax Appeals (CARF) and improvements in the taxation of closed-end and offshore funds.
Barreirinhas mentioned that these and other measures adopted during the past year have resulted in simplification and tax justice; rebuilding the tax base and reducing litigation (with major self-regulation actions throughout the period, in which dialogue and guidance from the IRS resulted in taxpayers complying, even before reaching the inspection and assessment phases). Barreirinhas highlighted that 2024 will be the “year of compliance”, supported by the Bill now sent to Congress.
Accordance
The “Compliance” pillar has three programs: Confia [Cooperative Tax Compliance Program], Sintonia [Tax Compliance Incentive Program] and OEA [Brazilian Authorized Economic Operator Program].
Confia provides for cooperation and dialogue actions, quantitative and qualitative criteria. “Taxpayers voluntarily join and participate in the dialogue with the Federal Revenue Service,” said the secretary, explaining that the program is already known to large companies, as there has already been a pilot of this operation. Dialogue and encouragement of self-regulation will always be prioritized.
Sintonia will encourage good practices and regularity, open to all taxpayers, universally, promoting the logic of compliance. With strong technological support, the program will allow taxpayers to be classified according to their level of compliance. “Those who are in the highest level of classification will have the highest level of benefits”, said Barreirinhas. It will be under the umbrella of Sintonia that taxpayers will be able to access the reduction of the CSLL rate. “It starts with 1% from the moment they reach the highest level of classification. If they remain in the classification, the discount on social contributions will increase by 1 point per year”, he stated.
The AEO is focused on strengthening the supply chain and encouraging regularity. The mechanism already exists and is a respected foreign trade program, Barreirinhas warned, but its legal framework needed improvements. This system will include deferral of payment of customs duties, ensuring priority in customs clearance.
Contumacious debtor
Finally, the “contumacious debtor” pillar targets taxpayers who fail to pay what they owe as a strategy to evade the tax authorities. In other words, it does not even focus on the case of recurrent defaulters, who may face successive difficulties but still try to regularize their situation with the IRS.
He emphasized that the country has 99% of “good taxpayers”. “But we also have bad taxpayers, and I’m not talking about those who can’t pay taxes, or businesspeople who are working hard every day, trying to make it big, but can’t pay taxes. That’s not the taxpayer we’re talking about when we talk about the habitual debtor. Unfortunately, we have taxpayers whose core business is not paying taxes. That’s what makes them money; it’s not the product they produce, it’s not the goods they sell. We’re talking about 0.005% of taxpayers who will be affected by this legislation on habitual debtors”, highlighted Barreirinhas (that is, 1,000 taxpayers out of a universe of 20 million taxpayers in the Legal Entity category).
“The persistent debtor has a specific profile, he is highly qualified,” said the Secretary of Revenue, noting that this often involves cases of agents who keep opening and closing companies (to avoid taxes) and with debts far above their assets. He also emphasized that only those with debts above R$15 million, in an irregular situation (without administrative or judicial suspension) for more than a year, can be classified as “persistent debtors.”
“Registering habitual debtors will allow the tax authorities to separate the wheat from the chaff,” Barreirinhas pointed out, when detailing points of the third pillar. There will be a specific registry to register habitual debtors, with very specific and objective criteria that can lead to this classification.
The changes foreseen in the bill sent to Congress should generate revenue gains for the government, but these effects will not be seen now, but in the future, the Secretary of Revenue pointed out. “Our focus with the proposals is not to obtain an increase in revenue in the short term,” he pointed out.
In addition to the Secretary of the Federal Revenue Service, Robinson Barreirinhas, the press conference detailing the Compliance Program was attended by the Special Secretary of the Federal Revenue Service, Adriana Gomes Rêgo; the Substitute Undersecretary of Inspection, Paulo Cirilo Mendes; the Substitute Undersecretary of Collection, Registration and Service, Márcio Gonçalves, and the General Coordinator of Customs Administration, José Carlos de Araújo; and the Head of the Largest Taxpayers Monitoring Division (Dimac), Marco Sérgio Veludo Gouveia.
Benefits control
The “Benefits Control” pillar will focus on the more than 200 existing tax benefit programs that, according to the Secretary of Revenue, generate an impact of “tens to hundreds” of millions of reais. “The number of these benefits is crazy,” he said. Barreirinhas emphasized, however, that the goal is not to eliminate tax benefits, but to analyze them, verify the effectiveness of each one of them and ensure that the system has effective management and governance.
He recalled that since 2021 there has been a constitutional directive determining the reduction of tax benefits, which established an eight-year deadline for Brazil to move from the current level of 4.5% of Gross Domestic Product (GDP) in tax benefits to 2%. “This was determined by the National Congress,” said the secretary.
Watch the press conference here.
https://www.youtube.com/live/WdqmRhXtjX4?si=msU4bNwz5Apc_Viw&t=196
Source: Brazilian Federal Revenue Service
