Technicians of the Budget and Financial Supervision Consulting (Conof), the National Congress, estimate that the reform do Income Tax (IR) proposed by the Federal Government would lead the shock of R $ 10.3 billion in consumption and reduction of 1,1% In income inequality in the country.
The projection of the technicians was released on Wednesday (2). The proposed reform exempt from IR who earns up to R $ 5,000 a month, reduces the tax to those of income between R $ 5,000 and R $ 7 thousand and, on the other hand, establishes a “effective minimum tax” to Brazilians with income exceeding R $ 50 thousand.
In the evaluation of Conof, the main macroeconomic effect expected from the measure is increased aggregate consumption. This is because low -income taxpayers have a greater propensity for consumption compared to high -income taxpayers.
“The stimulus to consumption should boost demand and, therefore, economic activity in the short term, especially in the retail and service sectors. Conof estimates point to a shock of R $ 10.3 billion in aggregate consumption due to the redesign in taxation of the proposed income by the measure,” says the material.
With regard to that the federal government claims to be the main objective of the reform, generating social justice, Congress technicians estimate that reform redistributes value equivalent to 0.25% of the country’s gross domestic product (GDP). That is: take this amount of higher classes and directs to the lowest.
This intervention would increase the current progressivity of the IR table by almost 30%in consulting calculations. “Still concerning distributive impacts, it is estimated that the project has the ability to reduce the inequality of income in the Universe of IR declarants by 1.1%, which comprises more than 40 million Brazilians,” he adds.
