The Plenary of the Federal Senate approved on 06/03/2013 Resolution No. 27, of 2011, which alters the Senate’s Internal Regulations, to regulate the competence, set forth in subsection XV of art. 52 of the Federal Constitution, to evaluate the Brazilian Tax System and the tax management of the federal entities.

The referred resolution sets forth that it will be incumbent upon the Senate’s Commission for Economic Affairs (CAE) to annually assess the functionality of the Brazilian Tax System, as far as its structure and components and the performance of the Federal Government’s, the States’, the Federal District’s and the Municipalities’ tax management entities.

The assessment of the functionality of the Brazilian Tax System shall analyze among others the following aspects: complexity and quality of laws; costs of compliance with tax rules; tax justice; meeting of budgetary needs; cost of ancillary obligations; tax load; tax breaks;

reduction of regional inequalities; compatibility with the laws of other countries or economic blocs. 

With regards to the system’s performance, the following aspects will be analyzed, among others: relation between the cost of the administration and the tax revenues; performance of the tax authority’s inspection; relation between spontaneous and coercive payment of taxes; tax management entities’ degree of integration; the quality of service rendered to the taxpayer.

The resolution provides that the assessments must obey the following timetable: receipt of documents and information: by March 15; public hearings to be held until April 30; submission of the final report, by June 30.

The approved report will be sent to the Brazilian President, the House of Representatives, the States’ and the Federal District’s Governors, the States’ and the Federal District’s Legislatures and the Accounting Courts. The Municipalities will receive an executive summary with the main conclusions.  

The Resolution enters into force on the date of its publication on the Senate’s Official Gazette.