Brazilian Tax Authority Gets Muzzled by Special Committee

By Xiu Yiing, Contributing Reporter

RIO DE JANEIRO, BRAZIL – A proposal was approved on Thursday by the special committee examining the Provisional Measure which created Bolsonaro’s government design, whereby auditors from the Federal Revenue Service are forbidden to investigate non-fiscal crimes, such as corruption.

The government leader in the Senate, Fernando Bezerra Coelho (MDB-PE), included the provision in the report presented on Tuesday.

The amendment, which originated from the rapporteur himself, was suggested by the leader of MDB in the Senate, Eduardo Braga (AM). It does not alter the MP itself, rather a 2002 law that disciplines tax auditors’ careers.

“We need to set limits so there is no exacerbation of certain powers. There has been an overstepping of duties by Federal Revenue Service inspectors, which are not within their powers and responsibilities”, said Bezerra on Tuesday.

The amendment was questioned by Randolfe Rodrigues (REDE-AP), leader of opposition in the Senate, who criticized the fact that the amendment was unrelated to the MP who set up the Bolsonaro government.

Senator Major Olímpio (PSL-SP) also challenged the measure, arguing that it would remove the Federal Revenue Service’s power to fight crimes such as money laundering.

The proposal was called “jabuti,” terminology used in Congress to refer to excerpts of projects unrelated to its subject.

The report establishes that “the competence of the Tax Auditor of the Brazilian Federal Revenue Service is limited with respect to criminal matters, to investigating crimes against tax order or related to customs control,” and that “the evidence of crimes other than those referred to in the previous item, with which the Tax Auditor of the Brazilian Federal Revenue Service is faced in the exercise of his duties, may not be shared without a court order, with bodies or authorities which are denied direct access to a taxpayer’s banking and tax information.”

“If necessary, I will go as far as the Federal Supreme Court, as it is a foreign matter to the Provisional Measure. And we’re going to try to reverse it in plenary. I’m afraid there has been little coordination (from the government),” said Major Olympius.

According to the senator, this proposal goes along the same lines as the withdrawal of the Coaf from the Ministry of Justice, also approved in the special committee, removing inspection power in investigations.

The leader of the DEM in the House, Elmar Nascimento, rejects this argument. According to him, who voted in favor of the measure, inspectors should abide by their responsibility, the tax area.

“A financial crime must be identified. If there’s some other crime, it must be forwarded to the D.A.’s office. This is what’s being defended. Whenever a leak occurs, they draw conclusions and then it is established that nothing had happened. That’s not an auditor’s job,” he said.