Closing the curtains for the controversial year 2022, Governor Ronaldo Cayado decreed the rates of the so-called “contribution” to the State Infrastructure Fund (Fundeinfra). Among agricultural products, it is worth noting that a maximum percentage of 1.65% is imposed on soybeans. Sugarcane was charged at 1.2%, corn at 1.1% and cattle at 0.50%. Fees begin in January 2023 and some acquirers are already including clauses in their product purchase and sale contracts that govern Ultimate Solutions.
According to the Minister of Communications of the Goiás government, the “contribution” will be optional from then on The rural producer may choose not to contribute to the fund, Waiver of the advantages she would receive in special tax regimes.”. This fanciful electiveness is, in fact, nothing but tax racketeering used to circumvent constitutional guarantees for taxpayers, which is why the individual contribution merits immediate recognition as unconstitutional.
The first point worth emphasizing is that there are no “advantages”. In fact, what exists, with regard to the constitutional text, is a differentiated tax treatment of the sector, for at least three basic reasons: the importance of production for food; compensation for vital agro-risks (climate, diseases, etc.) inherent in the activity; Not least, consider producers for the private conservation of natural resources.
The second point relates to the elective fallacy. Jizya is an obligatory and compulsory provision that does not depend on the desire of the taxpayer. He either pays or suffers adverse consequences on his assets, such as, for example, credit limitation due to loss of negative certificate, name negation, protest, and finally, tax foreclosure, whereby the goods will proceed to pay the principal sum plus penalty and interest.
Likewise, if he does not pay this new contribution, it will have severe equity consequences. This is because failure to pay immediately causes the loss and/or relativeization of important tax policy rules such as deferral, exemption, and worse, export immunity, with consequential damages to property and competition. Just imagine how bureaucratic the product organization would be if it had to calculate the debits and credits of ICMS on a monthly basis. Not to mention the absurd expectation of ICMS, in the case of export, a post-proven money-back guarantee, the proof of which depends, many times, on a commercial export or commercial Corporation. The refund time would certainly choke off the product’s cash flow.
To use an expression that has been enshrined in recent times, the state operates absolutely outside the four lines of the constitution, by making a strategy that was not expected there. According to the text, there are social contributions, interventions in the economic field, and the interests of occupational groups. It turns out that by constitutional mandate, only the Federation has the power to create these characters. I mean as a rule the state does not create a shareholding.
Although, even if it’s called that, it’s easy to see that the levy is, in essence, some kind of add-on ICMS in disguise. This is because it materially affects the circulation of agricultural and mineral commodities, as it is the responsibility of the senders, although, in most cases, the tax liability is attributed to the purchasers of these commodities.
The unconstitutionality of this figure is blatant! The first impediment is the delegation of the power to set tax rates to the executive branch, which undermines the principle of legality. Moreover, the principle of non-accumulation has been abolished, since some inputs purchased by the producer, in which ICMS residues are embedded, will not generate credit. Thirdly, “Contribution” overcomes export immunity, and burdens our product in the international market.
If this practice is not stopped, what will prevent other entities from granting benefits or simplifying rules of taxation on the one hand, and on the other, creating “optional contributions”, in order to see themselves free from the constraints of the taxing power, or, also, from the rules of Financial Law. The so-called “state money”, such as Fundersul, Fethab and now, Fundeinfra, are clear tax racketeering and if not contained soon, they can spread throughout the national territory, like an epidemic that pollutes the national tax system.
In view of the legislation passed and the recent establishment of rates, by decree, the only thing left for the judiciary is the calm, responsible and impartial protection of the guarantees of rural producers. Whether it’s team or individual, this is a fight that can’t be let go. After all, a whole system of taxpayer protection is at stake, and ultimately, from an economic point of view, the price of food and the country’s international competitiveness.
Álvaro Santos Master Student with emphasis on Law Applied to Agro by IDP-Brasília, Specialist in Civil Procedure by Damásio, in Environmental Procedure by UFPR, Tax Procedure by Ibet and Agricultural Procedure by FMP, Extension in Agribusiness Law by Insper , taxation in Agro by Ibet-FGV, agribusiness by FGV and tax planning by IBMEC, member of the Brazilian Confederation of Agricultural Undergraduates (Ubau) and the Study Group on Taxation in Agribusiness (Geta).