EDITORIAL
TAX JUSTICE is an imperative of Brazilian Democracy.
by Wilson R. Correa
Wednesday, 23 04 2024
The newspaper O Estado de São Paulo discloses this Wednesday, 12.04, the result of a survey by the Genial/Quaest institute, carried out with financial market agents, regarding its approval or disapproval of the Lula government.
As it could not be otherwise, the result was unfavorable to the Lula government: 90% of market analysts, managers and traders of investment funds disapprove of the government. The newspaper O Estado de São Paulo also reports that a previous survey by the same institute, from March 2024, recorded 60% disapproval of the government among this same segment. There was a 50% worsening in the indicator.
Nothing worrisome: this group is a very minority in the Country and could never approve the Lula government that, at this moment, cancels the exemption from Income Tax that this class has enjoyed since the FHC government.
This is what could be expected from this nefarious group of blood-suckers of fiscal resources of the Nation, which in these days has shamelessly manipulated the exchange rate in the futures market with the objective of (1st) causing the inflation rate to rise in order to (2st) raise the Selic and (3st) increase the income of banks' investment funds, (4st) to raise the cost of living and (5st) to indispose the population against the federal government. This naughty movement of this anti-people financial elite has (6st) a highly unfavorable effect on the growth of the Brazilian economy, can (7st) reduce the momentum of the process of increasing the level of employment of the population and (8st) can stop the long-awaited growth of industry on Brazilian soil.
The Faria Lima gang opposes the tax reform brought by Minister Fernando Haddad because this reform, if approved, exempts from income tax about 80% of salaried and self-employed people with a high secondary level in the country, those who have an income of up to R$ 5,000.00 per month, about only two minimum wages.
And, to compensate, the tax reform brought by Haddad taxes those who earn income equal to or greater than R$ 50,000.00 per month, more than R$ 600,000.00 per year, whether salary income, income from dividends and indirect benefits paid by their employers, incomes that have been shamelessly and unfairly kept exempt until today, since the Fernando Henrique Cardoso government.
It is important that we all remember that a partial tax reform was approved by the Chamber of Deputies, the proposed constitutional amendment PEC 45/2019, on 12.15.2023. It only covered five taxes considered dysfunctional, PIS, Cofins, ICMS, ISS and IPI, replacing them with another tax, the dual VAT, composed of the federal CBS Contribution on Goods and Services and the IBS Tax on Goods and Services, of the states and municipalities.
The text approved by the Chamber of PEC 45/2019 deliberately excluded an important element of the original proposal forwarded by the Lula government, which was the exemption from income tax for citizens with incomes of up to R$ 5,000.00.
This same element is currently being resubmitted to Congress for approval. And on that occasion, as at the present time, the pressure to the contrary exerted by the financial market was the determining element in the exclusion of this topic from that partial tax reform.
And what is the reason for this positioning of the financial market? The reason is that the country's financial elite does not want fiscal balance. Its objective is to keep the federal government in the lurch, cornered, with fiscal difficulties to fulfill the project of reinvigorating the Brazilian economy and with difficulties in the turnover of the federal public debt, because, in this way, the financial market has room to raise the Selic interest rate, to increase the profitability of investment funds remunerated at the Selic rate, to present high profitability in the quarterly balance sheets, to value the shares of banks and brokerage firms in the stock market, to increase the remuneration bonuses of the board of directors and managers of these investment funds, which until now have no incidence of income tax.
But its demand is not limited to raising the Selic rate. In his rhetoric to obtain fiscal balance is also the sale of public assets of the Brazilian population to private groups, to investment funds that are under the command of these 'market men'. Assets such as Caixa Economica, Banco do Brasil, Petrobras, BNDES, Banco da Amazônica, Banco do Nordeste, etc.
A certain well-known liberal economist, in defense of the morally unsustainable and selfish position of this gang of the financial market, recently offered his point of view by classifying as a "struggle between good and evil" the speculative war with the dollar and the stock market, launched these days by the 'market' against the tax justice project brought by the Lula government and against the income tax exemption for the 80% of the country that earns only and only up to R$5,000.00 per month.
It should be noted that this same economist is married to a lady, also a talented and revered economist, who, during the first term of President Dilma Rousseff, when the Brazilian economy was running at a rate of full employment, in one of the programs of GloboNews TV, presented at that time by the notable journalist William Waak, this famous economist, in a ... 'crisis of sincericide', defended the idea that the Brazilian economy needed "... unemployment... at least a little unemployment", with exactly these words. Nothing strange, because this is a basic concept of neo-liberal economics. But this is not something that is publicly commented on, outside the academic environment.
The fact is that, at that moment, even William Waak, a hardened journalist, frightened by this unconfessable statement, which revealed everything about the economic model of these 'liberal economists', quickly called the commercials, soon after showing some difficulty in making any comment about it: "... It's ... controversial ...", said the journalist almost choking.
What can be observed, at this moment, in the positioning of the financial market and the mainstream press that supports it, is a movement of class struggle: the class of the financial market and the rentiers, exempt from Income Tax, are fighting for the maintenance of their unjust tax privilege, against the rest of the Brazilian population, the poor population that sustained this unequal state of affairs, with their meager resources, with hard work, blood, sweat and tears.
It is past time for this privileged group to pay Income Tax. This is unpostponable and the president of Congress, Senator Rodrigo Pacheco, does not have to mediate with the financial market, postponing the approval of the fiscal plan that was sent to him on 12.03.2024. This minority public will not give you votes for the government of My Gerais. If he wants to be elected governor there, he should not attend to the interest of the financial market, which by the way is concentrated in São Paulo, no longer in Minas, since the old National Bank ceased to exist, swallowed up by the demand of the men of the 'market' at that time.
The president of the National Congress must seek that tax justice is carried out under the terms of the law; and to meet, rather, the interest of the people of Minas Gerais and of Brazil: to approve the fiscal plan prepared by the Ministries of Finance and Planning, which was sent to him by President Lula da Silva.
As for the hegemonic media, it is of little value. The newspapers O Estado de São Paulo, O Globo, Folha de São Paulo, Veja and Isto É et caterva magazines, have been operating for a long time to the detriment of the Brazilian People; because they are majritarily owned by banks, or to their interests submissive due to their millionaire spending on advertising.
And tax justice is an imperative from Democracy to Capitalism. The elites, who have already brought so much harm to the Brazilian people, owe this to the country, sponsoring coups d'état in the history of the Country and developing policies favorable to the concentration of income. In addition, fiscal equity is a necessity for the development of the country.
But this is not a revolution, because Tax Justice is also a technical requirement of the Capitalist System for its own sustainability. The famous economist John Maynard Keynes wrote enough about how harmful the so-called demand for money for speculation is for the survival of the capitalist system, that portion of the national income that no longer has a productive application because it is not directed to the market of goods and services, but, on the contrary, is kept waiting for a more profitable destination by its owners. According to Keynes, when this happens, the State must tax it to force its productive destination.
Another notable economist, Michal Kaleck, wrote in this same regard, incorporating into this same concept of 'demand for money for speculation' the notion of social classes: Capitalists are responsible for creating and maintaining their demand for money for speculation, so as to introject into the capitalist system the formation of stocks of goods not acquired in the market, "unrealized", which leads to unemployment, a drop in aggregate income and a depressive cycle in the economy.
The Workers' class, in turn, injects into the economy all its wage income ('over the month', as it is popularly said); and in the short term, in order to renew the production cycle.
For both authors, Keynes and Kalecki, it is up to the State to tax money for speculation so that it is injected into the economy to renew the cycle of production and consumption and so that a depressive cycle does not form in the economy.
The neo-liberal economic thought that permeates the minds of farialimers abhors this way of understanding the economy; and it has led countries to misery throughout the history of its use in the management of national economies. And why? Why is the neo-liberal way of thinking about the economy based on unemployment as a means of increasing labor productivity; it is based on the concentration of income as a means of increasing productive investments; A gross mistake, because the money in the hands of a few is directed to speculation, is not directed to production and does not generate jobs, does not promote development.
Hence the need for a State that taxes concentrated, speculative income. Therefore, it is essential that the Senate and the Chamber of Deputies approve at this time the exemption from income tax for workers with income up to R$ 5,000.00; and tax income above R$ 50,000.00 per month at 10%.
This is a necessity and an imperative for the economic and social development of the country.
Not only is Tax Justice an imperative of Democracy to Capitalism, but it is also true that Tax Justice is also a technical requirement for the sustainability of Capitalism.
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