Shopkeepers throughout Brazil are promoting, this Thursday (2), the Tax Free Day (DLI), with the aim of raising awareness among the population and the retail class about the weight of the tax burden on the country’s prices.
The National Confederation of Shopkeepers (CNDL) and the Young Shopkeepers’ Chamber (CDLJ), which promote the action, estimate that more than 40,000 stores in all states participate in the DLI. Construction companies, gas stations and malls also join the movement.
The idea is to market products and services without passing on the value of taxation to customers.
In Brasília, where the focus of the action will be gas stations, the CNDL predicts that establishments will sell a liter of fuel at around R$5, with a limit of 20 liters per car.
The average price of regular gasoline in the city is R$7.29, according to the latest survey by the National Agency for Petroleum, Natural Gas and Biofuels (ANP). According to figures from Petrobras, of this total, R$ 2.44 is in taxes.
According to the CNDL, for some products, the discounts offered this Thursday (2) can reach 70% of the final value of the merchandise. Merchants will assume the costs of products such as clothing, meats, gas cylinders, medicines, cosmetics, personal hygiene and cleaning items.
According to the national coordinator of CDL Jovem, Raphael Paganini, the mobilization is also a form of protest against the high tax burden.
“The Tax Free Day is an action of protest and general awareness of the high tax burden in our country, which limits the population’s consumption and disrupts the business environment. This day serves to show our dissatisfaction with a tax burden that reaches 40% of the average consumption of products”, he says.
“And with the action, we managed to bring both ends together, both the merchant, who suffers from the costs of taking the product to the consumer, and the buyer himself, who is penalized by high taxes and pays for this in the final price of the product”, evaluates the national coordinator of the Confederation of Young Store Managers.
The tenants’ confederations cite a survey by the Brazilian Institute of Planning and Taxation (IBPT), carried out in October 2021, which points out that Brazil has the 14th highest tax burden in the world. IBPT data show that, on average, Brazilians worked until May 29 this year just to pay taxes.
According to the São Paulo Commercial Association (ACSP), in 2022, until May, the population paid more than R$ 1 trillion in taxes alone. The amount corresponds to the total of taxes paid in all governmental spheres.
Taxation on consumption
Carlos Pinto, from the IBPT, explains that taxation in Brazil is based on three sources of revenue: consumption, income and equity. According to him, one of the biggest problems linked to the tax system in the country is due to the fact that consumption concentrates most of the collection, generating an imbalance.
“The big issue is that consumption taxation penalizes the poorest, so the system, as it is today, makes the richest get richer and the poorest get poorer. That’s because if everyone pays the same amount of consumption tax, this percentage will represent a much larger part of the income of the poorest than the rich”, he says.
“So if we were able to redistribute this burden and increase the income tax, the collection of the poorest would be eased and the value of taxes received by the government would be maintained”, evaluates the director of the Brazilian Institute of Planning and Taxation.
The tax lawyer also states that he does not see the Tax Free Day as a date to encourage consumption, but as “a day for consumers to realize how much their purchasing power is impacted by the amount of taxes on their daily consumption”.
Mobilization in all states
In this edition of the DLI, Rio de Janeiro participates as the campaign headquarters. Shopping malls in other capitals will also receive shares, such as Goiânia, Manaus and Vitória. In Belo Horizonte, actions will be concentrated on the city’s streets. Throughout the day, it will be possible to buy cheaper gas, gasoline and medicine in the capital of Minas Gerais.
In Mato Grosso do Sul, the action will take place in three malls in the capital: Shopping Campo Grande, Shopping Bosque dos Ipês and Pátio Central, in addition to other stores throughout the city.
The Tax Free Day was created in 2003 and takes place in every state in the country in more than 1,200 cities. In 2021, the action took place digitally and had the participation of 26 states and the Federal District, with the collaboration of more than 15,000 retailers.
Check the percentage of taxes on products that participate in the DLI, according to the IBPT:
- Clothing – 34.6%
- Meat – 29%
- Cooking gas – 34%
- Medicines – 33.8%
- Cosmetics – 55.2%
- Hygiene and cleaning items – from 31.1% to 78.9%
*under supervision of Helena Vieira
Source: CNN Brasil
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