A cut of more than 50% of Brazil’s federal revenue budget (RFB) could cripple essential activities and damage the routines of taxpayers and businesses as of May.
On April 11, the Federal Revenue Service Department of Brazil sent an official letter number January 21, 2022, “It is not legally possible to order or carry out expenses with this company from May 12, until there is a necessary supplement to the budget.” Sindireceita was able to access this discourse through the Access to Information Act.
In the official letter, the RFB management informed that Law No. 14303 allocated R$554.6 million for production services, system costs and other expenses with the public companies Serpro and Dataprev. However, to maintain these contracts in 2022, federal revenue needs an additional R$917.8 million. Also, according to the document, during the last meeting of the Budget Execution Board of the Ministry of Economy, which was held in March, the request for a budget supplement sent by the Fisheries Board was not considered.
Geraldo Seixas, President of the National Union of Tax Analysts of the Federal Revenue of Brazil (Sindireceita), warns of the dangers of “blackout” in the body and serious harm to the economy, businesses, taxpayers and the government itself. He remembers that the RFB, at this very moment, is already working on receiving and processing personal income tax returns (IRPF) and that without resources for the cost of information systems, this whole procedure can be hacked. “The consequences are numerous and range from a reduction in tax collection, to impacts on the economy. It is important to note that in the last year alone, IR refunds have injected more than R$35 billion into the economy. Much of this money goes directly to consumption,” he cautioned. , and even returns to the public treasury through the payment of taxes such as IPVA, IPTU and others.
Geraldo Seixas also warns of other consequences such as delays in the issuance and award of certificates, which are essential for the functioning of companies and foreign trade. Practically all procedures for analysis, inspection, collection, collection, verification and updating of records are based on systems. Likewise, the control of international trade, the release of goods, vehicles and people at ports, airports and border posts is also done through the systems. He explained that without these contracts and without the support of these companies, all these services and services to companies and taxpayers will be seriously affected.
In addition to contracts with technology companies, federal revenue is also at risk of crippling other activities due to lack of resources. For 2022, the RFB expects a budget of about R$1.2 billion, compared to the previous year, which was R$2.5 billion. If the value set in the Budget Guidelines Act (LOA) of 2022 is not revised, the federal revenue budget will be equivalent to what the corporation implemented in 2010.
Geraldo Seixas points out that if the cut stipulated in the IRS budget for 2022 is maintained, the country will come to a halt. “Without resources, the enterprise will not be able to carry out its activities in border control and foreign trade while harming public safety and the economy with delays in releasing imports and exports. There will be a shortage of resources for essential activities such as serving businesses and taxpayers, which will also have negative consequences for the economy The country, which needs a stimulus so that we can weather the current crisis. We are issuing this alert so that the Federal Revenue Service can do its job and help the country weather this dangerous moment.”
Since 2019, the servers of the Federal Revenue Service in Brazil have confiscated more than 176 tons of drugs, mainly marijuana and cocaine, at ports, airports, border posts, and surveillance and crackdowns were carried out across the country.
In the past three years alone, the damage done to organized crime through measures to combat international drug trafficking, smuggling and embezzlement has exceeded R$28 billion.
In addition to working in border control, travelers, and facilitation of foreign trade, Federal Revenue Officers also play an essential role for the economy, businesses, taxpayers, the state, and all Brazilian citizens.
It is the day-to-day work of these civil servants that ensures the resources used in the cost of all procedures, care, policies, and public services that are provided daily throughout the country. From January to December 2021 alone, Federal Revenue Service employees collected R$1.878 trillion, a real increase of 17.36% over the previous year.
Resources obtained from tax collection and contributions, but also secured by various collection, installment, service and continuous actions to combat crimes such as evasion and evasion of foreign exchange and many other crimes that harm the economy and the country as a whole.
These are expressive results that embody the importance and relevance of the work that Federal Revenue Officers perform for the state, primarily for Brazilian society. Results that demonstrate the exceptional performance of those state employees who need recognition and appreciation.