Draft approved by the Chamber to abolish tax exemptions for drugs and other chemicals and pharmaceuticals | Photo: Agence Brasil
The income tax reform, the vote of which was concluded this Thursday (2) by the Chamber of Deputies, could lead to an increase of up to 12% of more than 18 thousand pharmaceutical products, including drugs for use continuous such as those used in the treatment of chronic diseases. The alert comes from the Research Pharmaceutical Industry Association (Interfarma).
The bill, which will be further analyzed by the Senate, provides for the end of exemptions from PIS and Cofins for drugs in order to compensate for the loss of income with measures such as the reduction in corporate tax (IRPJ) and in the Social Contribution on Net Income (CSLL) and the updating of the Personal Income Tax table (IRPF).
“There will be an impact on the SUS, which serves over 80% of the Brazilian population, with an increase of over 18% due to the ICMS load. Indeed, certain agreements link the ICMS exemption to the PIS and Cofins exemption ”, explains the president of Interfarma, Elizabeth de Carvalhaes. “The National Congress must review this decision to prevent the health of Brazilians from being compromised and the end consumer paying this bill,” he defends himself.
The extinction of the subsidy was proposed by the rapporteur of the bill, MP Celso Sabino (PSDB-PA), who alleges that the gradual reduction of federal tax incentives and benefits is already provided for in constitutional amendment 109, sanctioned in March 2021.
At least 13 plenary amendments presented by MPs from different parties called for the device to be removed, but all were rejected. “The drafting of the text will lead to an increase in the tax burden and a consequent increase in the price of medicines, so that this is the only tax benefit passed on to the population, the States, the municipalities and the Union itself. same “, argued Marcelo Ramos (PL-AM).
“This revocation will have a cascading effect and will weigh on the entire chain, negatively impacting the health sector as a whole, reaching such reflexes on patients and imposing an additional challenge on managers to keep care in line. quantity and quality needed, whether within the scope of SUS or health insurance, ”said Silvia Cristina (PDT-RO).
MEP Danilo Cabral (PSB-PE) stressed that the measure will affect even those who produce or import vaccines. “It turns out that the average tax burden on drugs in the world is 6%, while in Brazil it represents 32%. Thus, further increasing the burden on these products hinders access to health, creates obstacles to the realization of human dignity and exacerbates the health problems facing Brazil, at a time as critical as the Covid pandemic. -19 ”, declared the Parliament.
In his report, Sabino defended that the companies concerned will be considered with the reduction of the IRPJ and the CSLL and that the benefits for producers and importers of drugs show regressive characteristics. He cited the December 2019 edition of the Ministry of the Economy’s Monthly Union Subsidies Bulletin, which found that the poorest 20% of the population appropriated 6.3% of the benefit, while Richest 20%, 43.5%.
In contrast, a provision that repealed tax incentives for the ship, aircraft and parts industries ended up withdrawing from the project. For the rapporteur, the aviation sector has been excessively affected by the economic impacts caused by the coronavirus pandemic. “Its reinstatement can have very serious consequences on the viability of air transport in the country,” he said.
The gain from lower profits for ships “would be negligible for the proposal, while it could have negative consequences for regions heavily dependent on river transport”, in the words of the deputy.
In Sabino’s calculations, ending the drug tax benefits will translate into additional revenue of BRL 10.9 billion in 2022, BRL 11.6 billion in 2023 and BRL 12.3 billion in 2024. The others chemicals and pharmaceuticals will generate revenues of R $ 5 billion in 2022, R $ 5.3 billion in 2023 and R $ 5.6 billion in 2024.