Government seeks business support to PEC with extension of payroll exemption

Announced on Thursday (11) by President Jair Bolsonaro (no party), the extension of the payroll exemption in 2022 and 2023 was a solution found by the federal government to get the support of business sectors to revise the spending ceiling.

In recent months, economic sectors have been pressuring the Ministry of Economy for the risk of mass layoffs in the coming years, also due to the impacts of the Covid-19 pandemic on companies’ coffers.

In addition to seeking support from the business sector for projects that the government wants to approve in the Legislative Power, the nod is also a way for the economic team to have more time to articulate a source of funding for the broad tax exemption, an idea defended by the Minister of Economy, Paulo Guedes , since the beginning of the government.

“But, with the sector present, it wasn’t just that. We asked them to collaborate with us to approve the issue of precatório there,” said Bolsonaro after informing that the government will extend the exemption.

Compensation

The idea is that the decrease in payroll collection, estimated at around BRL 8 billion in 2022, is offset by the budgetary slack generated by the anticipation of the review of the spending ceiling in 2022, a mechanism present in the PEC of Precatório.

The Fiscal Responsibility Law (LRF) requires the federal government to waive an expense to finance the loss in federal revenue generated by the tax relief.

The measure comes only one day after federal deputy Marcelo Freitas (PSL-MG) presented a report in favor of the bill that extends the exemption from the payroll of companies in 17 sectors until 2026. Such sectors are strategic for the market of work in the country, as they generate the most jobs.

Manifesto

This week, a group of businessmen is preparing a manifesto to be delivered to the president of the Chamber of Deputies, Arthur Lira (PP-AL), in an “urgent” defense of the extension of the tax exemption to 17 sectors. With the announcement, however, they must change the line and focus on the discussion of a broad tax exemption policy.

In conversation with the CNN, deputy Marco Bertaiolli (PSD-SP), coordinator of the Parliamentary Entrepreneurship Front, stated that the government’s signaling surprised, since in months of negotiation the Executive continued against the extension.

“We had been dealing with this issue for a long time and, as they did not manifest themselves, we defended the project, which was extended until 2026. We were in this insecurity, but we received this announcement with great joy”, he said.