Ciro Gomes X Government Temer: public debt audit, taxation of profits and dividends

Among the various topics dealt with by the current labor pre-candidate, there are two issues debated by Ciro Gomes there are times and often, for which he tries to draw the attention of the Brazilian people: the need to revise the percentage of the Brazilian budget destined for the expenses with the public debt and the need for taxation of profits and dividends   in Brazil.

For decades, neoliberal representatives in Brazilian economic policies have tried to stifle these two debates, but (perhaps in the face of the dread of them as Ciro Gomes's pre-candidacy grows) this week, suddenly, Brazilians are surprised to learn that some forces brought these two subjects to the fore.

Rodrigo Maia, in the presidency of the Chamber of Deputies, said he was considering establishing a working group to analyze the return of the tax on profits and dividends.

On the public debt audit, a federal court judge ruled that the National Congress should set up a parliamentary commission of inquiry (CPI) to audit the Brazilian public debt within a 30 days.

The potential benefits of these two measures are great, and these are debates that certainly need to take place in the country, but what would have been the motives for these political and legal forces at this point in the country to suddenly decide to regulate the two issues? Is it possible to trust that important debates like this will be treated in the light of the real interest of the Brazilian people, at this moment so close to the elections, by congressmen protagonists of the chaos created in the Michel Temer government?

Since 2016, the country has been living with the reforms proposed by the government Michel Temer and with the participation of Rodrigo Maia, who, under the appearance of efficiency and modernization, have demonstrated anti-people, anti-poor and anti-national changes. In the same period, there were several apparently neutral judgments that turned into harms to Brazil. In the face of so many examples, Brazilians seem to have every reason to be suspicious of Rodrigo Maia's motives and the impact of the judicial decision that determines the CPI, for fear of seeing such important matters being sent with the worst possible decisions. In addition, a judicial decision to determine a CPI (parliamentary commission of inquiry) is unfortunately a fact that further destabilizes the balance between the powers at the moment in which we live and reinforces the idea that the Brazilian judiciary exceeds its constitutional limits.

In the case of taxation of profits and dividends, the working group formed by Rodrigo Maia would also have members of the DEM and other parties that support the government (such as the PSDB and PMDB). It is worth remembering that Brazil was charged with a tax on profits and dividends up to 1995, when former President Fernando Henrique Cardoso issued a provisional measure, in favor of collection, which was later approved by Congress and converted into law { 1 / 1995. In other words, there is the possibility that the parties that supported the collection (PFL, PMDB, PSDB) are the same ones that will now discuss the tax return, since DEM, PSDB and PMDB support the current government.

There has also been a Public Debt CPI, completed in May of 2010. Pedro Novais (PMDB-MA), the deputy rapporteur at the time, presented a disputed report by another group of deputies, since the discussions did not involve a complete audit, which also considered possible illegalities in the debts of states and municipalities. And right now, there is the possibility that the PMDB's governing base will again be responsible for the rapporteur's report and for the work of a parliamentary committee of inquiry on the subject.


According to Ciro Gomes, the revision of budget expenditures with public debt is at the heart of a fiscal reform that the country needs to make, since it is considered that a single expense amounts to about half of the Brazilian budget, making it difficult to allocate more money in the state investments in education, health, infrastructure, sanitation and other current expenditures for the population.

In addition, Ciro mentions the existence of possible illegalities committed in the negotiations that are behind the value of public debt, since the institutional arrangement of the Brazilian economy (such as the real interest rate, for example) sometimes seems so absurd to the point of distrust that its true meaning would be to privilege this expense and this remuneration to the powerful creditors of the debt, to the detriment of privileging the investments of the State with the population.

Already, the taxation of profits and dividends is discussed by Ciro Gomes as an idea related to the necessary tax reform in the country, where it would be necessary to reduce and simplify taxes at the time of production (contrary to what happens nowadays in Brazil, in that a company is heavily burdened when it comes to producing and selling) and to discuss the incidence of taxes at the time profits and dividends are realized.

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