October 10, 2019 / 4:16 PM / 10 days ago

Brazil to send tax reform to Congress, includes VAT: Guedes

Brazil's Economy Minister Paulo Guedes gestures as he speaks during Brazil Investment Forum in Sao Paulo, Brazil October 10, 2019. REUTERS/Amanda Perobelli

SAO PAULO (Reuters) - Brazil’s Economy Minister Paulo Guedes said on Thursday that once pension reform is approved, the government plans to send a tax reform proposal to the lower house of Congress, including a federal-level value-added tax (VAT).

Guedes said the government would seek to link the federal VAT with state taxes and also redesign income tax. He added that the government will not botch its efforts to overhaul the tax system for the sake of getting it done quickly.

Brazil’s government is pursuing a raft of reforms to shore up weak government finances that it argues will provide a shot in the arm to the economy, which is sluggishly recovering from a deep recession.

Post-pension reform, the government will also send a “federative pact” bill to the Senate, which would institute new rules for federal and state budgets.

Guedes said he would also seek to accelerate the privatization of state-owned companies and was dissatisfied with the current pace of progress.

Reporting by Eduardo Simoes; Writing by Jake Spring; Editing by Chris Reese and Daniel Wallis

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