In a session held last Wednesday, the 4th, the National Congress overturned the presidential veto to art. 33 of Law 14.020/2020, related to the extension of the Social Security Contribution on Gross Revenue (“CPRB”) to 2021 from 17[1] sectors of the economy that, together, generate approximately 6 million jobs.
The so-called payroll tax relief regime was an alternative found by the Public Authorities in recent years to encourage the maintenance and creation of new jobs, as, in practice, it reduces the tax burden paid by the employer and makes the hiring process less expensive, especially in labor-intensive sectors.
This system allows companies to choose to collect the employer's social security contribution on a percentage that varies between 1% and 5.5% on gross revenue, instead of collecting the percentage of 20% on the payroll.
According to information presented by the Ministry of Economy, it is estimated that the impact of this extension on public coffers could reach R$4.9 billion, given the lack of a specific source to compensate for this loss in revenue.
Our tax team remains available to clarify any questions regarding this matter.
[1] Footwear; Call Center; Communication; Clothing/Clothing; Civil Construction; Construction companies and infrastructure works; Leather; Vehicle and body manufacturing; Machinery and equipment; Animal protein; Textile; Information technology (“IT”); Communication technology (“ICT”); Integrated circuit design; Metro-rail passenger transport; Public road transport; and Road freight transport.
