In a report delivered this Thursday (28/9) to the rapporteur of the tax reform in the Senate, Eduardo Braga (MDB-AM), the Federal Court of Auditors (TCU) assessed that the IBS Federative Council presents a high risk that the Federal and State Courts will issue divergent decisions on the CBS and the IBS in controversies involving tax authorities and taxpayers.
For the TCU, there is also a high risk in the operationalization of the council's external control, for example, for the analysis of complaints and representations about its performance, since PEC 45/2019 “does not define in the slightest the design of the exercise of external control”.
Approved on July 7 in the Chamber of Deputies, the tax reform proposal (PEC 45/19) provides that the new consumption tax will be created along the lines of a Value Added Tax (VAT). Two VATs will be created: a federal one, called the Contribution on Goods and Services (CBS), combining IPI, PIS and Cofins; and a subnational one, called the Tax on Goods and Services (IBS), combining ISS and ICMS. The text is now being processed in the Senate.
One of the main points of disagreement regarding the proposal concerns the creation of the IBS Federative Council. Through this body, the states, the Federal District and the municipalities will carry out the integrated management of the tax collection. Some of the subnational entities disagree with the text, considering that they will lose autonomy in the management and collection of the IBS, which would violate the federative pact.
In the TCU's assessment, there are no elements that indicate that the IBS Federative Council represents an offense to the federative pact regarding the shared competence of the IBS or regarding the active tax capacity of the federated entities, that is, to collect and monitor the IBS. However, the court warns that PEC 45/2019 does not indicate a specific court for the joint judgment of controversies over the IBS and the CBS. Therefore, by logical understanding, the competence is divided between the Federal and State Courts.
The TCU suggested to Eduardo Braga that he include a provision in the PEC to define that the complementary law of the IBS and CBS establishes the concurrent jurisdiction of the two courts to judge these controversies, with a so-called “prevention rule by continence”, so that the case remains in the court “that first becomes aware of the facts related to these taxes”.
Regarding the external control of the Federative Council, the TCU criticizes the fact that PEC 45/19 does not define the body responsible for evaluating the accounts of its administrators and for assessing complaints and representations regarding the council's performance. The court notes that the proposal also defined the body that will preside over the coordination of the actions of the various external control bodies, “which brings the risk of each control body acting in a disconnected manner and apart from the coordination provided for in the PEC provision”. Along these lines, the rapporteur proposed to Eduardo Braga the creation of a collegiate body of the audit courts to carry out the external control of the IBS Federative Council.
During a press conference, Eduardo Braga stated that he will evaluate the TCU's suggestions and assessments in order to prepare his report, which should be presented between October 18 and 20. The senator said that, starting this Thursday (9/28), the report preparation phase will begin, in which he will analyze the 250 amendments presented to date. In addition, the rapporteur once again emphasized his commitment and concern to guarantee the neutrality of the reform and his desire to include in the text the establishment of a limit for the tax burden.
The presentation of the opinion was scheduled for this Wednesday (27/9). However, it was postponed again and, as a result, the entire schedule for analyzing the matter in the Senate will be pushed back to November, in an optimistic outlook. The postponement increases the clout of the Speaker of the Chamber of Deputies, Arthur Lira (PP-AL), who will once again be placed in the position of “resolver” of the government's problems, between giving traction to the tax collection package and, now, using his skills as a vote operator to ensure the completion of the tax reform by 2023.