Map shows where tax money comes from and goes

Data from the Federal Revenue and the IBPT (Brazilian Institute of Planning and Taxation) indicate the existence of at least 66 taxes in all spheres of government –14 taxes, 35 types of contribution and 17 fees. The number of charges, however, is just one of the problems that make the national tax system complex.

A study by the IBPT shows that practically 1 in every 5 federal regulations that have emerged since the 1988 Constitution had the tax area as their theme. On average, there were four rules per business day in the period related to taxation.

At the moment when Congress makes the last attempt to pass a broad tax reform in the current administration, the sheet updates the “Tribute Map” with data from 2021 (see the 2019 version, one of the Malofiej design award winners). Taxes that account for 90% of the collection of the Union, states and municipalities were considered.

Symbol of the fiscal war, the state ICMS, is the one that collects the most. Due to its complexity, it is one of the main targets of reforms that unify taxes on goods and services.

Another target is the record-breaking tax rate, the IPI (Imposto sobre Produtos Industrializados). Its regulation occupies almost 500 pages, which classify numerous products.

For “cigarettes containing tobacco” and “cigarettes containing no tobacco, other than hand-made”, for example, the tax rate was 300% on 15% of the retail price. Handmade cigarettes pay 30%, as does smoking tobacco that doesn’t come in the cigarette.

Also outstanding in the collection are taxes on income and payroll, much criticized by the current government, which intended to promote a tax exemption on the payroll by creating a contribution on financial transactions.

The main proposals under debate do not change the tax burden of around 34% of GDP (Gross Domestic Product), close to that of European economies, but they can balance the system, which today falls more on consumption, burdening the poorest, than on income and wealth.

The taxation map also shows the allocation of resources. Two-thirds of federal government spending goes to Social Security and active and inactive personnel. When allowances, BPC, allowance and unemployment insurance are included, this amounts to 80% of non-financial expenditure, which makes the government practically a payer of benefits.

The map does not include financial income and expenses. Last year, there were R$ 560 billion in debt amortization and interest, an expense that is only surpassed by Social Security (R$ 710 billion).