Levy says government not to turn back on salary freeze
Joaquim Levy at a hearing that lasted more than five hours with the Joint Budget Commission,
Finance Minister Joaquim Levy denied that the government is planning to go back on the fiscal adjustment measures to be submitted to the National Congress. In an interview with journalists, after a hearing that lasted more than five hours with the Joint Budget Commission, he said that the government does not plan to change the proposal to freeze the salaries of civil servants and the re-allotment of the funding from the Sistema S (which encompasses social work and learning services in several sectors of the economy, in collaboration with companies), moves aimed at closing the Social Security deficit.
Over the next days, the government is expected to send to Congress two provisional measures re-alloting funds from businesspeople's contributions to the Sistema S for Social Security and the Income Tax. One of the plans includes sending 30% of revenues from the Sistema S to Social Security. The other stipulates that a discount on legal persons' Tax Income for companies investing in research and innovation should apply for contributions under the Sistema S. He admitted, however, that the Sistema S itself should adjust spending in the upcoming years.
The minister restated that the CPMF is the tax capable of raising the federal government's revenues in a short period of time without costing society too dearly. “The CPMF gets everybody. It gets companies, it gets even those with a slush fund. For this tax, there's no merit. It doesn't only affect the production system and it decreases distortions in the economy,” he added.
According to Levy, the fiscal adjustment package does not include higher taxes only, but also spending cuts, a ministry overhaul, plans to make investment easier, and a medium-term reform in Social Security. “We're going to discuss everything that makes Brazil able to grow more quickly and better,” he noted.
Translated by Fabrício Ferreira
Fonte: Levy says government not to turn back on salary freeze
