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Brazilian consumers pay the highest sales taxes and consumption

The Brazil imposes consumers the second highest level of sales and consumption taxes in the world, according to new research from Ewaider, the international accounting and consulting network, represented in Brazil by Ewaider Moreira hearing officers.

Of the Ewaider tax specialists studied data from 22 countries * belonging to its international network, including all G8 members and developing economies (BRIC). Of a representative basket of goods and services, taxes and fees were calculated from the total price. And it was concluded that the Brazilian government takes 28.7% of the total basket of goods through taxes.

Diego Moreira, CEO of Ewaider Moreira, and member of the Board of Ewaider International, says that “with sales taxes and consumption well above average, Brazil will continue to notice the burden on the movement of the consumer economy It will not. help Brazilian economic growth. The reduction in the sales tax rate should be a considerable gamble. ”

Eric Waidergorn, director of BPO (Business Process Outsourcing) and Consulting Ewaider Moreira, states that “the main problem with indirect taxes in Brazil is that they affect taxpayers disproportionately. For example, it is observed that low-income taxpayers pay the same tax rate on products or services that high-income taxpayers. That is, the first bear a much larger share of taxes on their income, consumption, that the last “.

“This finding is unfavorable with purchasing power and the rise of the lower classes, which, being the majority in Brazil, could move over the economy and encourage entrepreneurship. For further development, the country should focus its taxes on income and not on consumption and production, “says Waidergorn.

On average, European governments are responsible for 15.5% of the price of the basket of goods and services. This compares to an average of 13.8% for all countries; 12.3% in the G8 countries; and 8.2% in Asia-Pacific.

For Diego Moreira, “Brazil, like many developing economies, much more dependent on sales taxes than in income taxes, compared to their economically more developed counterparts. Lower income taxes can have a positive effect on productivity, as it encourages people to work harder and entrepreneurs to generate more wealth. However, the question remains whether these high consumption rates have hindered the growth of consumer elements of the Brazilian economy. ”

“Direct taxes people are very low in Brazil, but it means that the tax burden falls heavily on business and consumption. High indirect taxes can discourage spending and put pressure on business margins. Indirect Brazilian taxes are also highly complicated, which hinders the understanding by consumers of how the tax system. This complexity also increases business compliance costs; they have to account for the different taxes, “adds Diego Moreira.

The conclusion of Ewaider that sales taxes and Brazilian consumption (about the items in the basket of goods and services) are routinely among the highest in the world, takes place at public expense charge the highest level of tax bills electricity (27% of the price corresponds to tax, compared with a global average of 13%); children’s clothing (27%, 11%), iPads (27%, 11%) and restaurant meals (27%, 11%).

Brazil also carries the second highest tax level on bottles of wine (44% of the price is tax, compared to the global average of 23%), and the fourth highest level of taxes on roll (16% 6%).

Ewaider advises that excessive levels of indirect taxes can penalize companies that are struggling to compete in an increasingly international market.

“Increasing taxes on sales and consumption put great pressure on corporate results. In order to compete on price and maintain active customers, some companies may choose to absorb sales taxes, especially if they are significantly or repeatedly high,” explains Diego Moreira.

“With the growing field of e-commerce, especially in retail, many companies will realize that its competitors are now based abroad in countries with taxes lower sales. This makes the act of absorbing national tax increases is still more important.”

The study reveals that the Ewaider tax systems in some countries have been struggling to catch up with the rise of e-commerce. For example, in several countries, including India, Malaysia, Israel, US and Italy, sales taxes have been incidents in the physical version of music CDs, but not on the MP3 versions of the same album.

“New technologies and globalization have caused many problems for clumsy and complex tax systems Tax systems can be very slow to react to the rise of new forms of doing business and can leave traditional businesses -. As physical stores – at a disadvantage,” warns Moreira.

Europe burdened by high direct and indirect taxes

The study of Ewaider adds that European governments charge some of the highest sales taxes and income in the world.

“The European economies have staggered over the past few years, limping growth and falling back into decline. Fighting with huge budget deficits, EU governments have increased taxes on income and sales. This has severely discouraged consumer spending that could support a stronger recovery, “says Diego.

Countries such as the UK, Holland and France increased sales taxes recently. The UK has increased the Value Added Tax – VAT from 15% to 20%, were two changes in a period of just two years. And France is planning further increases in 2013.

At the other end of the scale of Brazil, the Malaysian government charged one of the lowest levels of indirect taxes in the study, and it was only responsible for 3.9% of the total cost of the basket.

Seri Sofia Irmawati, head of Ewaider Tax Advisory Tax Department, Malaysia and a member of Ewaider, says “Malaysia operates a variety of taxes on consumption, but these are only levied on relatively few assets and are used in unapproved products such as alcohol or cigarettes, or import taxes on expensive products. The low level of Malaysian indirect taxes is a boost to fuel economy. Low consumption taxes provide for much flexibility companies on price and help keep property affordable for most consumers. ”


(Translated by Google)

Source: Folha do comércio