Tax today is 3.2%, but it can triple, reaching 9.6%; sector negotiates with the state government and is optimistic about the possibility of the special regime being extended
The possible increase in São Paulo’s EM has generated great concern among businesspeople in the sector. Currently, the tax is 3.2%, but there is a forecast that it could reach 9.6%, tripling the current value. This change is scheduled to occur after December 31, when the sector’s special regime will end. Carlos Dias, legal director at Sindresbar, highlighted that this increase could result in a 20% increase in prices for consumers. He also highlighted that the sector has little margin for tax credits, which makes the credit and debit regime dysfunctional and unfair.
In response to this situation, , under the leadership of Tarcísio de Freitas, has signaled the possibility of extending the special regime, after negotiations with sector representatives. The intention is to avoid a negative impact on a sector that is still recovering from the devastating effects of the pandemic. Comparatively, other states such as Rio de Janeiro and Minas Gerais maintain ICMS rates of around 3%, which puts São Paulo in an unfavorable position if the increase is implemented. The expectation is that an agreement will be reached to prevent São Paulo from having a rate significantly higher than the national average. “The governor signaled that he intends to extend the regime for a while longer, with some adjustments,” revealed Dias.
The bar and restaurant sector plays a crucial role in the local economy, being responsible for around 6% of jobs in São Paulo and Brazil. Furthermore, it is a vital component of gastronomic tourism, attracting visitors and contributing to the economy. The discussion about increasing the ICMS reflects a dilemma faced by governments across the country: the need to balance tax revenue with the economic impact on consumers and productive sectors.
“Our sector, unlike others, has very few tax credits. Most of the inputs that restaurants purchase are exempt or purchased from suppliers in Simples. Another issue is that the added value margin for the sector has to be high because the restaurant includes a series of services in its costs that do not generate credit. This is the reason why the sector’s credit regime is dysfunctional, as well as unfair”, explained Carlos Dias. “If [o regime especial] is not extended — and we understand that it will be extended by the governor —, the impact on the consumer is a price increase of around 20%.”
The hope of bar and restaurant owners in São Paulo is that continued dialogue with the government will result in a solution that does not harm the competitiveness and economic recovery of establishments in São Paulo. Maintaining a competitive rate is seen as essential to ensure that the sector continues to prosper and contribute significantly to the State’s economy. The outcome of these negotiations will be crucial in determining the future of the sector and its ability to remain competitive in an already challenging market.
*Report produced with the help of AI
