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A proposal called “Super VAT” aims to unify VAT, Gross Income Tax, and municipal levies into a single 9% federal tax with additional local taxes possible, inspired by Brazil’s VAT reforms.
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The reform seeks to simplify tax compliance, reduce distortions, and increase efficiency by centralizing tax collection and redistributing funds to provinces through a revised co-participation system.
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VAT currently accounts for a significant portion of tax revenue, with six national taxes contributing 83% of public income, highlighting the potential impact of consolidating taxes for efficiency.
- Although not yet officially considered by the government, the proposal aligns with broader tax reform goals aiming to drastically reduce the number of existing taxes.
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Supporters argue the model would ease business burdens and improve transparency, while critics cite challenges in political consensus and fiscal coordination across government levels.
Source: vatcalc.com
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