Súper IVA Reform Proposal Introduced

• 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.

• 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.

• 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.

• 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

---

---