After an apparent agreement with the government following a long meeting on Sunday, yesterday made it clear that the alternatives presented by Minister Fernando Haddad to the increase in IOF (Tax on Financial Operations) are still far from reaching a consensus. As highlighted in the newspapers, this was made clear by the Speaker of the House, Hugo Motta, who stated yesterday that his commitment is to "debate and analyze," but not to guarantee the approval of the measures. In fact, one of the proposed measures, the end of the exemption on investments in Fiagro (Investment Fund in Agro-industrial Production Chains), generated a negative reaction from the agribusiness caucus, which has enough weight to block the measures. "We know there will be a reaction, which is why I am saying that the commitment made regarding the measures that will come in the provisional measure is for Congress to debate and analyze; especially since the leaders did not have time to consult their caucuses," said Motta, at a seminar organized by VALOR ECONÔMICO. Motta even advocated a government shutdown as a way to force an effective solution. "Perhaps this is what the country needs for everyone to step out of their comfort zone. Everyone is looking at the situation and no one wants to give up anything," he said.
Newspapers are providing more details on the government's proposals. According to FOLHA DE S.PAULO, the 10% cut on tax incentives, one of the proposals presented by Fernando Haddad on Sunday, will involve "reducing benefit by benefit." The idea is that a portion of 90% of the tax waiver would be maintained. "If the benefit is an exemption (which has zero tax), it will be taxed at 10% of the standard tax rate. For example, if the standard rate is 10%, the taxpayer would be taxed at 1%," the report explains.
Another initiative, which would be included in a provisional measure but with effects only for 2026 due to the principle of prior notice, is "a broad reform in the taxation of Income Tax (IR) that applies to financial investments," as noted by VALOR. The government's idea here is to establish a fixed rate of 17.5% on both fixed-income and variable-income securities and funds. Currently, there is a progressive taxation of these investments. In the case of currently exempt securities, there would be a rate of 5%. This includes LCI, LCA, and agribusiness securities – which generated a more consequential reaction in Congress, given the weight of the rural caucus. According to the newspaper, "the Treasury considers that these are changes that correct distortions in the securities market" and that the government had been considering them "for a long time.".
Finally, on another front, VALOR also highlights that, in an unprecedented monocratic decision, Minister Gurgel de Faria of the Superior Court of Justice (STJ) ruled against the collection of Corporate Income Tax (IRPJ) and Social Contribution on Net Profit (CSLL) on presumed ICMS credits, even after the entry into force of Law No. 14,789/2023. This law, proposed by the Ministry of Finance, seeks to tax all ICMS tax benefits and was accompanied by expectations of a billion-dollar increase in federal revenue. The minister's statement, aligned with the opinion of the Federal Public Prosecutor's Office, maintains the Court's previous jurisprudence, which favors taxpayers, and reinforces the understanding already adopted by 62% decisions in the Regional Federal Courts, according to a survey by the Mattos Filho law firm. The decision is seen as a positive sign for companies, which were waiting to see if the STJ would change its position in light of the new legislation. For tax lawyers, Gurgel de Faria's vote indicates that it would not be necessary to file new lawsuits to maintain the previous tax treatment.