Economy Ministry Wants New Financial Transactions Tax, But Faces Heavy Opposition

Despite the resistance of President Jair Bolsonaro himself, the economic team led by Minister Paulo Guedes remains firm in its plan to create a tax on financial transactions similar to the former CPMF, but on a permanent basis.

RIO DE JANEIRO, BRAZIL - The government is including in its proposed tax reform that withdrawals and cash deposits be taxed at an initial rate of 0.4 percent. The collection is part of the concept of tax on payments, which is being compared to the former Provisional Contribution on Financial Transactions (CPMF).

For debit and credit payments, the initial rate studied is 0.2 percent (for each end of the transaction, payer and recipient).

Both rates tend to grow after they are established since the government's goal is to use the new tax to gradually replace taxation on wages . . .

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