Lula da Silva’s new tax could take US$4 billion out of Brazilian worker’s pocket per year

The Brazilian workers who got rid of the union tax in 2017 can already prepare their pockets.

Before the approval of the labor reform, in Michel Temer’s government, unions, central unions, federations, and confederations took more than 3 billion reais per year with the compulsory contribution deducted from the payroll, which corresponded to one day of work.

The proposal discussed by Lula da Silva’s transition team is to create a “negotiation fee” to replace the tax.

It would work like this: the union would hold a meeting and decide on the creation of the tax and the percentage that would be charged to the worker’s payroll.

In Brazil, experience shows that assemblies with only a few dozen union members make decisions affecting thousands of workers’ lives in the same category.

An economist connected to the union area told VEJA that if the contribution were to be charged again in the same parameters as before the labor reform, the value could exceed US4 billion annually.

Lula da Silva’s transition team is formed, among others, by representatives of CUT, Força Sindical, and UGT, exactly those most interested in reviving the union tax.

They will be the ones to present a final proposal to Lula. One of the names on the transition team is the advisor to the Forum of Trade Union Centrals, sociologist Clemente Ganz Lúcio.

He was a member of the Presidency’s Council for Economic and Social Development in Lula’s government and has collaborated with the Lula Institute and the Perseu Abramo Foundation, linked to the PT (left).

“The negotiation tax is a common tax to finance unions worldwide,” says Gans Lúcio. “In the world, in general, the limit is around 1% of the annual salary.

The creation of a new tax is not expected to have a return. After the 98% drop in union dues, all the main union centers began to support Lula on the condition that there would be a return for their coffers.

Lula da Silva announced in April, at the CUT, in São Paulo, what would be the formula to finance the unions.

“What we want is that it be determined by law that the workers and the free and sovereign assembly decide what the contribution of the union members should be. And the central unions and the free and sovereign assembly decide what the union’s contribution to the entity is.” This is what he calls “solidarity and democratic financing of the union structure.”

The resumption of these dues should strengthen the unions and the central unions.

After the end of the tax, revenues, the number of strikes, and even the number of union members elected as members of parliament fell, as shown in an article in this week’s print edition of VEJA.

The unions have always been used as an extension of the PT machine to elect PT-affiliated representatives.

With information from Veja