The Minister of Finance, Fernando Haddad, stated this Monday (10) that the bill that expands the Income Tax exemption range for those earning up to R$5,000 per month should be sanctioned by President Luiz Inácio Lula da Silva this week.
“I believe that this week… I don’t know what the president’s agenda is like, but I believe that on Tuesday or Wednesday this project will be sanctioned,” said Haddad in an interview with CNN Brazil.
The minister praised the unanimous approval of the proposal in both houses of Congress, with 493 favorable votes in the Chamber of Deputies and symbolic approval in the Senate, and classified the result as an example of political maturity in the midst of polarization.
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“For a project of this magnitude, which affects so many interests, to be approved unanimously in both houses is an extraordinary feat of politics,” he stated.
Tax neutrality
Haddad defended the project as an advance in reducing income inequalities, by exempting lower-income workers and increasing taxation on the super-rich.
“We are exempting those who earn up to R$5,000, reducing the tax for those who earn from R$5,000 to R$7,350 and charging 141,000 Brazilians who earn around R$1 million per year and pay an average tax rate of 2.5%,” he said.
The minister also highlighted that the text was created with fiscal neutrality, validated by the Independent Fiscal Institute (IFI) of the Senate.
“The project has no revenue bias. It charges those who didn’t pay and earned a lot, and exempts those who worked a lot and paid too much, earning little”, he explained.
Fighting inequality
Haddad stated that the initiative marks a “first big step” in tackling income inequality and should serve as an example for future social justice policies.
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“Throughout the process, they said that Congress would never accept taxation of the super-rich. And, even with a mostly conservative Congress, we had a unanimous vote,” he stated.
According to the minister, the approval paves the way for a permanent agenda to combat inequality.
“Brazil is still among the ten most unequal countries in the world. This project paves the way to change that”, he concluded.
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