Income Tax Reform: Lula defends taxing dividends to fund exemption for those earning up to R$ 5.
With the reform, income tax collection will affect 141 people from the wealthiest segment of the population, or 0,13% of taxpayers or 0,06% of the population.
247 - President Luiz Inácio Lula da Silva (PT) defended, this Tuesday (18), the taxation of dividends to finance the project that foresees the exemption of Income Tax for those who receive up to R$ 5 thousand. During a ceremony that marked the sending of the proposal to Congress, Lula said that the text is a “reparation” and will not increase the tax burden.
The text also includes a minimum tax on high-income individuals and a new levy on corporate profit remittances abroad.
“This is a neutral project. This project will not increase the Union's tax burden by one cent. What we are doing is simply a reparation. We are saying that 141,000 Brazilians, who earn over R$ 1 million per year, will contribute so that 10 million people do not pay income tax. It's that simple,” he said.
“It’s like giving a gift to a child. It won’t hurt anyone, it won’t leave anyone poor, it won’t cause those who contribute to stop eating their meat, their salad, their shrimp, their lobster, their filet mignon. But it will allow the poor to eat some meat. We are allowing people who don’t have this opportunity to have this opportunity,” he concluded.
According to a survey by the Ministry of Finance, 90% of Brazilians who pay income tax (equivalent to more than 90 million people) will be in the total or partial exemption bracket, and 65% of individual income tax filers (about 26 million people) will be totally exempt.
With the reform, income tax collection will affect 141 people from the wealthiest segment of the population, or 0,13% of taxpayers or 0,06% of the population. Those who earn more than R$ 50 will need to pay 10% tax on profits and dividends, which is income paid by companies and was previously exempt from taxation.
