Chamber approves bill extending payroll exemption

Text also reduces the social security contribution of municipalities. Proposal goes on for further consideration in the Senate

The Chamber of Deputies approved this Wednesday (30) the Senate Bill 334/23, which extends the payroll exemption for 17 sectors of the economy until December 31, 2027. The rapporteur's text was approved, deputy Any Ortiz (Cidadania-RS). The proposal returns to the Senate due to the approved changes.

The payroll exemption replaces the employer's social security contribution, of 20% on the payroll, with rates from 1% to 4.5% on gross revenue. The idea is for this mechanism to reduce labor charges in exempt sectors and encourage the hiring of people. The benefit would end on December 31, 2023.

“These sectors are the ones that employ the most in the country, with more than 9 million jobs and, certainly, the non-extension of this policy would imply millions of dismissals and impact society as a whole”, said the rapporteur.

The waiver with the exemption in the private sector is estimated at around R$ 9.4 billion, according to the Ministry of Finance.

INSS of municipalities
Congresswoman Any Ortiz's text also deals with another topic, the reduction of the social security contribution of all municipalities, which will be valid until 2027 and will vary from 8% to 18% according to the Gross Domestic Product (GDP) of each city.

Currently, the employer contribution for hiring under the Consolidation of Labor Laws (CLT) is 20%, and the senators' text provided for 8% for approximately 5,300 municipalities.

Debate in Plenary
The Senate project was processed attached to PL 1016/23, by Deputy Ricardo Ayres (Republicanos-TO), which also deals with payroll exemption and ended up being rejected in favor of replacing the text of the senators.

Ayres praised the rapporteur's work. “We need to ensure predictability and planning for these companies. This approval does not prevent the revision of the subject with the tax reform. The money left over for these companies will be reverted to technology development and innovation actions, ensuring greater competitiveness in these sectors of our economy,” he said.

Against the exemption, deputy Lindbergh Farias (PT-RJ) lamented what he called inconsistency. “This House needs coherence. The financial impact of this exemption could reach R$ 30 billion, a total irresponsibility. Fiscal austerity for the poor can, and then they will come with the talk that it is necessary to carry out another Social Security reform”, he criticized.

Also against the project, Deputy Tarcísio Motta (Psol-RJ) demanded the maintenance of jobs. “Does this create more jobs or increase the profit margin of companies? Calculations are presented, not validated and never questioned. As the exemption of municipalities will not generate more jobs, does the federal government have money left over to put into the INSS? This is a legitimate debate, but it is being held in the wrong place and time”, he argued.

Deputy Chico Alencar (Psol-RJ) regretted what he considered the historic use of public resources for certain sectors. “The project clashes with everything that has been claimed here in terms of the fiscal framework. There is, in Brazilian economic policy, the history of improvisation always in favor of the rich, as it was with the policy of valuing coffee, the purchase of its surplus with public money”, he said.

Rates
With the exemption, benefited companies can choose to pay social contributions on gross revenue at rates from 1% to 4.5% instead of paying 20% of INSS for employees by the Consolidation of Labor Laws (CLT).

The benefited sectors are: footwear, call center, communication, apparel/clothing, civil construction, construction companies and infrastructure works, leather, vehicle and bodywork manufacturing, machinery and equipment, animal protein, textiles, information technology (IT) , communication technology (ICT), integrated circuit design, subway-railway passenger transport, collective road transport and road freight transport.

However, until December 2027, there will be a reduction in the rate from 2% to 1% for collective road passenger transport companies, with a fixed route, municipal, intercity in the metropolitan region, intercity, interstate and international.

Instituted in 2011 for some sectors, mainly IT, ICT and call center, the exemption policy was expanded to several sectors of the economy in 2014, but was reduced due to the large tax exemption from 2018, remaining since then only for these sectors.

cofins
The project also extends for the same period the additional 1% on the Cofins-Importation rate, instituted by Law 10,865/04.

This charge exists to make taxation on gross revenue equitable, both in the domestic market and in imports.

Counties
One of the points added by the Senate in the text of PL 334/23 was the reduction, from 20% to 8%, of the INSS rate for municipalities with a population of around 156 thousand inhabitants.

The rapporteur, after negotiations with party leaders, adopted the criterion of proportionality of the GDP of each municipality and the Federal District, which benefits all of them, regardless of the population.

The reduction will follow a gradation according to GDP per capita, according to the exhaustive list to be published by the Ministry of Finance, based on IBGE data:

8% for the 20% of municipalities with lower GDP per capita;
10.5% for those between 20% and 40% with the lowest GDP per capita;
13% for cities between 40% and 60% with lower GDP per capita;
15.5% for municipalities in the 60% to 80% range with the lowest GDP per capita; It is
18% for the 20% of municipalities with higher GDP per capita.
The list to be published will not be changed due to future GDP or population updates.

For the leader of the government, Deputy José Guimarães (PT-CE), municipalities are facing a serious financial crisis and the agreement reached by the Chamber to include gradual payment “does tax justice with all Brazilian municipalities”. “We could not discuss the exemption without including them at that moment”, he said.

Guimarães stressed, however, that this is not a good policy, and should be reviewed in the context of tax reform.

novena
In respect of the rule of ninety, according to which no tax can be changed before 90 days of its publication in law, both the increase in Cofins-Importation and the decrease in INSS for municipalities (waiver of revenue) will come into force on the first day of the fourth month following the month of publication of the future law.

Amendment rejected
The only highlight voted and rejected by Psol's Plenary, intended to approve an amendment by Deputy Guilherme Boulos (Psol-SP) to prohibit companies benefiting from the exemption from dismissing without just cause or reducing the salary of their employees in the six months after the end of the new term.

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Source: Câmara de Notícias Agency