Dimas Alberto Alcantara*

Writ of mandamus is the constitutional means made available to the individual or legal entity with procedural capacity to protect an individual or collective net and certain right threatened with injury by an act of authority, whatever category it is and whatever functions it exercises.

The use of this broad instrument specifically in tax matters has reached greater relevance as the State's fiscal voluptuousness also grows, each day more and more unrestrained in the different spheres. Previously used modestly, today the tax injunction has supplanted other legal measures applicable in this universe, such as repetition of undue payment, embargoes for tax enforcement, annulment of entry and the declaration that the legal-tax relationship does not exist.

The writ of mandamus in tax matters today assumes a prominent position in forensic daily life and has led to new concepts, procedures considered as classic and stabilized. Its option is also more advantageous not only due to the fact that there is no conviction in legal fees to the unsuccessful party, but mainly because it is an important fast and effective means to challenge abusive and illegal acts already practiced (repressive form), tax assessments in non-compliance with the law or preventively the act to be performed by a public agent. This last aspect, one of the forms most requested by the taxpayer, raises the debate regarding the illegality or unconstitutionality of certain rules that aim to impose or increase taxes unduly, methodology that the Brazilian State is more careful to use every day.

Regarding the granting of a preliminary injunction, the requirement for tax credit is suspended. The understanding that the basis of the request and its relevance prevails and there is a risk of the final order that may be conferred, the requirements to justify such instrumentalization of the process are satisfied. In this sense, Complementary Law 104/2001, which added item V to article 151 of the National Tax Code, shows that the measure of anticipation of the tutelage in this matter endeavors to suspend the liability of the tax credit. Undeniable object of taxpayers' desire in general.

However, it is essential to clarify that the petition of this instrument requires the existence of a net and certain right, which means that any invocation of subjective right must have the respective facts documented (pre-constituted evidence) or even such proof is unnecessary, regardless of the legal complexity of the issue.

Controversies exist, as in all branches of law. Despite the fact that the Superior Court of Justice has already established an understanding about the suitability of the writ of mandamus for the request for offsetting tax credits, some magistrates tend to deny this claim by taxpayers based on the summary 269 and 271m of the Supreme Court. The first establishes that the writ of mandamus is not a substitute for a collection action and the other ensures that this instrument does not have equity effects in relation to the past period, which must be claimed administratively or through the proper judicial means. It turns out that both summaries were approved more than 45 years ago, a time span of approximately half a century and of undeniable evolution of both society and said judicial provision.

Therefore, in addition to the classic legal differences in matters of this nature, it is important and fundamental to check facts, dates and arguments to support the deed and succeed in the dispute. Which is also a fundamental point in legal matters in all its aspects and not only the tax.

Article published in Diário de Notícias page 02 - São Paulo, Tuesday, May 6, 2014.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. Email: alcantara@alcantara.adv.br

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Dimas Alberto Alcantara*

Although also temporarily very delayed, since the tax debacle started in the last century, the Adin - Direct Action of Unconstitutionality filed by the Brazilian Bar Association (OAB) with the Supreme Court - showed the great mass of taxpayers the complete absence of ethical and constitutional parameters of the public power when launching its claws over the citizens, in search of more resources for its coffers.

To better situate the extent of the problem, it is worth remembering that the Income Tax is the main tax collected by the Union and over the past few years it has been improving its tax refinements in a curious way in terms of a country little accustomed to the exemplary functionality of the public authorities. The Lion, as it is popularly referred to, knows everything and discovers everything by interweaving in its fine fabric the most cunning artifices conceived with the eagerness to collect less cash from public coffers.

This tax, which goes directly to the federal coffers, raised BRL 292.8 billion in 2013, with a 25.7% share in the total revenue of BRL 1.138 trillion. In the month of April, this participation exceeds 28%, due to the annual adjustment, as in 2013, and due to the increasing deterioration of the fiscal accounts, the Federal Revenue becomes the main protagonist of any attempts at adjustment in the sector.

It so happens that, although there are other distortions, the one now legally contested by the OAB directly affects the individual - IRPF, i.e. the ordinary citizen who obtains income in salaried or autonomous work and survives in average conditions, generally supporting family and children. The lack of correction according to the inflation in the values considered as minimum to guide the need for the presentation of the declaration, made that, throughout these years, an illusory and made-up table was constituted in order to increase more and more the number of people required to submit the declaration.

There are reliable data to support the thesis now raised by the OAB. Data from Dieese - Inter-Union Department of Statistics and Socioeconomic Studies show an accumulated gap of 61.24% in the IR calculation table between 1996 and 2013. The Adin now proposed by the OAB, with an incomprehensible delay easily proven by the data already mentioned, benefits not only the exempt ones, but any and all people who pay IR according to the tables. Just as another example, this gap even hurts constitutional precepts of the concept of income, of the existential minimum and of productive capacity, protected from tax confiscation, as is characterized by the situation discussed.

In the face of so much evidence of this tax confiscation, it is even more perplexing that only class entities, from which the OAB only reverberated more, manifested themselves on the subject. It should be noted that in supporting Adin, as in other timid manifestations of associations and unions, it is impossible to stop asking about the reasons that have silenced so many and so different associations so far. Why an inexplicable synchronism with the routine annual disclosure of tables and deadlines for the presentation of the statements for the previous year?

Society awaits explanations, now not only from the public authorities, but from their representatives (which are part of the society) who have so long been omitted in something so directly linked to ordinary people. After all, why those who in 1996 earned up to eight minimum wages were exempt and today, if they receive around 2.5 wages of the same nature, they fall victim to the fine mesh. This is neither social nor democratic progress, but official imposition and silence from the masses, which must be broken as soon as possible.

Article published in Diário de Notícias page 02 - São Paulo, Tuesday, March 18, 2014.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

Celebrated as a significant advance in the relationship between the public authorities and private companies, Law No. 12,846/2013, in force after all legal procedures and deadlines for its effectiveness have been exhausted, has instruments to better balance this relationship and increase the credibility of possible foreign investors in the country.

With the technological race, which provides immeasurable advances in the creation and exploitation of wealth of the most diverse profiles, the social and political demands of communities are also increasing, especially in the so-called countries with emerging economies. Despite the critics and oppositional to this material impulse, as global differences between countries and peoples increase, there is no way to sustain theses of a more naturalistic nature, whatever the angle chosen for this argument.

It is clear that this is a requirement of citizens, which has been manifested even publicly on several occasions, but it is imperative to recognize that, although backed by legitimate administrative and social principles, it is yet another attempt to correct and control a practice, the corruption, which is becoming more common every day. And it spreads at all levels of public power and private companies, considering the different and excessive possibilities of circumventing or minimizing punishments, until then used by individuals listed in possible transgressions.

Now, this universe expands and also makes companies responsible for acts of corruption, regardless of the individuals involved. The objective responsibility expands and becomes joint between controllers and subsidiaries, consortium members, as well as successors in mergers or acquisitions, greatly expanding the universe of those responsible for acts that may harm public interests. This unprecedented extension of punishment also creates incentives for companies to adopt codes of conduct in corporate governance, another suggestive innovation in Brazilian legal terms.

In assessing the different approaches embedded in this now celebrated legal diploma, there are also generic provisions that disturb the understanding of varied and even controversial aspects of the matter. This occurs with the leniency that, if it benefits a particular company, it may end up having its legal benefits neutralized in the course of the deed. These same processes that also bring to light the diversity of instruments and ways of accessing the implementation of this new mold of the relationship between private companies and public authorities. These escape valves, captained by the historical delay in the application of legal penalties at all levels of the different judicial spheres, are still present and awaiting regulation. Boosting the speed of these procedures is a peaceful point in this healthy endeavor to moralize customs, now in alarming expansion.

Another important aspect to highlight in this initiative concerns the relationship and the country's own image in relation to international companies, with renewed incentives to direct its investments to Brazil, highlighting that the Brazilian business environment would now be coated with more transparency and legal security for this and other types of transactions. The conclusion is satisfactory, but it should not obscure the reality that only one law, full of good intentions and severe punishments, has the power to clean up a universe whose health is fundamental for the country and its inhabitants. It is an initial step that, like so many others, runs the risk of succumbing to the gigantic trunk of laws and measures that Brazil has always insisted on supplying.

Article published in Diário de Notícias page 02 - São Paulo, Friday, February 21, 2014.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

In spite of the growing disclosure of the value and tax burden on the lives of Brazilian citizens and companies, the number of individuals and societies that do not realize the fundamental importance of planning is still very high, so as not to increase the growing contingent of those captured by the increasingly sharp claws of the tax authorities. And only then seek the competent help of professionals in the field to try to chase the damage, or at least not to get even more wrapped up in those same claws.

The end of year celebrations, coupled with carnival and holidays, make the annual calendar effectively start in late February or early March. For some activities, this extension has already been incorporated into national life and many commitments are usually scheduled for when this period ends, and the year actually begins. In other sectors, this prolonged celebration literally does not exist and obligations and deadlines are the same as in other periods of the year and even more conducive to planning what is intended or required in the new year.

Tax planning, also known as tax avoidance, is one of the most significant activities of this period. For greater accuracy, this work should mark the month of December not only due to the legal alignment with the terms and requirements of the tax authorities, but also and mainly so that the taxpayer - individuals or legal entities - plan their activities for the new year. And be very clear about the aims and commitments that should guide this period.

Regarding the business world, although this period is already close to its fiscal limit, it is still possible to carry out tax planning for 2014 as long as there is a full understanding of the importance of this work and the necessary instruments are available for its effective and positive accomplishment. Based on this awareness, seek advising from professionals in the field, inside or outside the company itself, allowing them to assess the current tax conditions of the company and from there elaborate the planning that will guide both the choice of tax regimes that can be more favorable, as well as the layout of the procedures to be followed to obtain the best results of this work.

The search for tax avoidance, it is necessary to emphasize, given the lack of knowledge of the real meaning of this expression, cannot be confused by the widespread tax evasion. These are diametrically opposed practices and only the first fits into tax planning, which, although it stopped occurring in the previous year, can still be used by many companies. Thus, the end of February allows the option for the Real Profit in the monthly calculation defined in the first payment of the Income Tax, and, in April, also the first payment in the quarterly calculation of that same tax, or even for the Presumed Profit, regime that brings as a novelty this year the increase in the revenue limit from BRL 48 million to BRL 78 million.

Although it is part of a broader and increasingly complex universe, this choice made now will influence the success or failure of the organization in the coming months. Once again, the planning of the activities in focus is decisive, with simulations and prospections, accounting analyzes and other studies available so that the correct decision is made. The entrepreneur also cannot ignore that this provision of services in both the legal and accounting areas will represent some expenditure, but in general, when respected the limits of each system, it will bear fruit in the same year in which they are adopted.

Seeking to pay less tax within the law is the foundation of tax planning, such an avoidance, and it is also important to emphasize that among the various nuances that make up this broad tax map, only its implementation by the company's managers will allow this result to appear and can be celebrated at the end of the period. And transform those entrepreneurs who defended the need for these apparently theoretical studies to leverage the results of the venture into respected executives, who also earn their share of recognition in business management.

Article published in Diário de Notícias page 02 - São Paulo, Friday, February 14, 2014.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados.E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The controversial Tax on Circulation of Goods and Services - ICMS had its payment deadlines extended by up to 75 days, starting on January 1 of this year, according to a decree (Decree 59,967/2013) signed by Governor Geraldo Alckmin in December. This benefit favors chosen sectors and will reach smaller companies, most of which are included in Simples Nacional and also those submitted to tax substitution.

Given the incredible fiscal voracity of the public sector in all areas of activity, the government provision, although it does not represent a reduction in the tax due, will benefit sectors that currently need to self-finance to collect the tax, as they receive for the goods sold in installments, on dates that surpass those that demand payment of the tax.

Companies that collect the ICMS between the third business day and the 10th will have a single term on the 20th, a new date that is valid for the collection in the so-called periodic calculation regime, i.e. the ordinary regime, which is out of the tax substitution and Simples. Still within this regime, there are companies that collect the mentioned tax on the 22nd and will only gain an extension of three days. Just to include and support the reasoning that bases these considerations on the timidity of the government decision, the benefit of the ordinary regime reaches companies that collect a total of BRL 1.70 billion, about 17.7% of the monthly tax revenue. This regime currently includes 67,024 companies.

The controversial and complex tax substitution system, which payments are currently made until the 15th and will have a single term on the 20th - five days of benefit - encompasses 27,283 taxpayers, who collect BRL 796.7 million, a slice of 7,9% of monthly revenue. It is not difficult to understand the difficulties faced by the State Treasury to manage so many and so complex aspects of economic activity, notably in a dynamic and developed State like São Paulo. The diversity of today's financial and economic negotiations goes beyond the old give-and-take concept of old times and involves periods of up to 120 days or more for certain transactions, but this reality escapes the official vision, centered solely and exclusively on collecting, despite the increasingly vehement and incisive demands and challenges.

In this complex universe, the biggest beneficiaries of the measure are Simples' companies. They will have 45 to 75 more days to pay the tax, starting to collect it on the last day of the second month following the taxable event. The measure should reach 155 thousand taxpayers and reach Simples' companies that collect in the rate differential or that make the advance payment, also valid for the payment in traditional tax substitution. Among the various segments that have already declared themselves favorable to this extension of time is the vehicle industry, as it will also have an impact on the sector's production chain, which will feel less the end of the IPI tax exemption on vehicles and the white line and other specific changes in the general tax configuration of the sector. This aspect was highlighted when the timid measures were announced by the State government, emphasizing the need to gain competitiveness in the face of the acute competition between national and imported products.

The criticisms of various sectors, of course, are not made to the extension of these deadlines, but precisely the lack of emphasis and the distance from reality that the authorities insist on continuing to maintain. And to this outlook, there is undoubtedly the political connotation of the measure, in a pre-electoral period which prognoses are not very favorable to the current state government, the main target of those who wish to reach the Palácio dos Bandeirantes for the first time in many years.

Article published in Diário de Notícias page 02 – São Paulo, Friday, January 10, 2014.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

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Dimas Alberto Alcantara*

Year after year, the different budgetary exercises of the powers of the Republic end and begin again, and the question of court orders remains pending decisions on decisions by the most different sectors, especially the Federal Supreme Court. Its status as capital body of the Judiciary ends up taking the final decisions of the different interpretations raised by the matter to its magistrates and, in their absence, there is the most absolute disagreement on how to allocate resources in the next budget, to honor the court-ordered debt payments recognized until July 1st of each year.

There are countless difficulties encountered, mainly by the municipalities, to try to at least solve the problem that, in rounded and approximate numbers, reaches BRL 30 billion in the State of São Paulo alone. It is impossible to evaluate the different discussions centered on the legislative houses of cities that owe court-ordered debt payments and are trying to find a solution to such debts, which are only growing. But there are cases that can illustrate the issue, even if partially, as, by the way, it is almost routine in this intricate matter.

Numerous alternatives, such as installments, payment terms for these debts, sanctions for states and municipalities that disobey such determinations, linking these same debts to percentages of the respective budgets - such as education and health - among other questions pertinent to the said tax engineering, remain without at least reasonable definitions by the Supreme Court.

An option that has caused disagreements in almost all legislative houses, when assessing budgets for the coming year, concerns the holding of auctions in these court-ordered debt payments. The impasse occurred recently in Santo André, in ABC Paulista, which mayor included in the Annual Budget Law for 2014, the creation of a Chamber of Conciliation of Court-Ordered Debt Payments, basically to negotiate their advance payment by waiving up to 50% of the amount receivable.

In view of the already discussed possible unconstitutionality of auctions to settle these debts, another controversial aspect of the matter, the law now approved has agreed to create a conciliation chamber as long as it is ensured that it will make the call transparently, in the order of the date of each debit, or amount, and may gradually reduce this percentage if there are no interested parties. Thus, the concern of not favoring certain creditors, to the detriment of others, a practice that is pointed out as one of the biggest problems of this form of negotiation of court-ordered debt payments, was evident.

The proposal is interesting, it can yield good results for the Municipality, as long as it is used transparently and free from protectionism, as court-ordered debtors denounce, who took a stand against what is also called reverse auctions, since the debtor is the one who offers the discount. Aware of the probable legal disputes, LOA established the median division between the amounts intended to remedy this liability in the next year. Half will be automatically reserved to comply with the chronological order established by the Court of Justice and the remaining amount will be allocated to such auctions.

The budgetary and operational placement is still interesting and represents an option for municipalities that are better allocated in revenue. Possible doubts about its legality, as well as correct implementation, will only be resolved when the process really develops. And it may even, by eliminating any suspicions of unconstitutionality or sponsorship of so-called privileged creditors, serve as a model for other cities, also dealing with similar problems. Some light may come out of this confusing outlook that is hurting millions of people across the country.

Article published in Diário de Notícias page 02 – São Paulo, Friday, December 13, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. Email: alcantara@alcantara.adv.br

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Dimas Alberto Alcantara*

The history of jurisdictional provision, in the most diverse eras and latitudes, has always been marked by the difficulties of putting into practice in real life the devices and regulations listed in codes, uses and customs characteristic of each people and place. Congestion and high cost, combined with the complexity of the Brazilian judicial system, deprive millions of citizens of access to rights that are often elementary to any properly organized and democratic society.

The issue has been focused on in different studies and reports, but given the complexity and socio-political scope of the matter, it has not yet received due attention from experts as well as from the community itself, today only a little more aware of the collective protests and demands strength. And this inertia starts to be justified, in Brazil, in view of the structural outlook of the system between us, divided and subdivided into multiple spheres: state, federal, labor, electoral, military and dozens of courts, all with administrative autonomy, in addition to four judgment instances that end up flowing into the Supreme Federal Court. In 2012, the latter registered 66,930 cases, a workload impossible to be managed by a Supreme Court of 11 judges, an avalanche that also develops a wide range of reformist theories, such as the one that advocates for the diminution of the competence of this Power, listed in 347 long articles of the Constitution, covering almost all fields of law.

The same occurs with the instance below the jurisdictional hierarchy: the Superior Court of Justice, with national jurisdiction, the third and special instance of the common justice (except the electoral, labor and federal military), but outdated in the definition of constitutional issues, always possible to be modified in the upper instance. Even so, it has remained with only 33 ministers since 1988, mirroring the idea of official abstractionism in relation to the rapid growth of the country and its population in recent decades. Nor is the indisputable explosion of demands arising from it and the creation of the popular special courts, another celebrated democratic achievement of the population.

To this only brief overview of the complexity of the Brazilian jurisdictional provision, we can also list the dubiousness between the democratization of this service through four instances of judgment, but which offers exactly opposite results in practice; those who can afford good lawyers are also able to postpone trials for issues that should be resolved almost immediately. Changing laws, reviewing technical-judicial codes and procedures is part of any attempt to improve this outlook, but it does not solve the problem and often creates even others.

The political will and administrative competence of the three branches of government are fundamental to any successful act in this troubled outlook. Although independent and harmonious, as a constitutional norm, they are interdependent in terms of legal foundation in public resources to program this true revolution in practice. And it must incur both the core of power itself, as well as its scope and participation in community life, far from medieval togas and monarchical ghettos that scare away citizens and can only attract those who find in this elitism a good resource for their millionaire demands.

Not by chance, but due to the author's editorial strategy, the last is the one that should be considered as the most important partner for the modernization of all this tangle that constitutes the Brazilian Judiciary Power and is at the heart of modern life: the total computerization of this fundamental segment of democracy. Only this can settle with reworks that clog the different stages of this provision, save paper and time, develop and expand the Electronic Judicial Process, implanting modules in the data centers in police agencies and Public Ministries and where else it should reach the celebrated and little accomplished jurisdictional provision.

It should be asked to the holders of the three powers and their exponential members or candidates: who will be the Brazilian capable of carrying out a project of this magnitude, which cannot be postponed for the consolidation of the country as a modern nation and really inserted in the 21st century?

Article published in Diário de Notícias page 02 – São Paulo, Monday, December 9, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. Email: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The promises of tax simplifications often touted by the government, right after the first analysis end up revealing new attempts to fill the public coffers a little more, with the respective negative balance for taxpayers. The idea now is to unify Cofins (Contribution for the Financing of Social Security) and PIS (Social Integration Program), two practically similar taxes, but with different incidence and also different exceptions.

In short, for some companies both taxes are levied on all revenues, with rates of 0.65% (PIS) and 3% (Cofins); for others, depending on the activity, it is allowed to deduct costs from raw materials and different inputs from revenues; in these cases, the rates rise to 1.65% and 7.6%. The doubts regarding their accounting start with what these inputs are, the subject of countless controversies and real pitfalls for the taxpayer and result in the most convenient choice between the two regimes: cumulative or non-cumulative.

In the first, the rate is lower, but companies cannot deduct taxes already paid by their suppliers; in the non-cumulative, the tax rate is higher, but companies can deduct taxes already paid by their input suppliers. Here, the legal controversies about which inputs can be discounted from the calculation base of the total to be collected have already started. The variants are considerable and this whole conflict must be well managed when choosing.

From the tax change desired by the government, countless specialists have already detected and pointed out what lies at the heart of this supposed attempt to simplify the collection system of these two taxes. The change would put an end to the cumulative regime, and everyone would start paying the single rate of 9.3%, but they could write off their credits, just as today with the non-cumulative regime. In other words, for those who carry out activities that involve costs with raw materials and the similar, e.g. industry and commerce, everything remains practically the same.

It will fall on the service sector, one of the main, if not the main segment of Brazilian GDP, disseminated by the country in recent decades, as this type of economic activity spends little on inputs. If in industry, for example, they represent 42.3% of expenses, in the service sector this figure drops to 12.5%, most of which is spent on payment of labor, therefore with few credits to deduct from the final value. This dissimilarity between one and the other type of activity is so clear that, when these two taxes were created, different regimes were also stipulated. And now, with the nod of the much-desired simplification of the national tax system, the government erases the previous concepts and does not hesitate to endorse a change that only means an increase of about BRL 35 billion per year for federal coffers.

The consequences of this eventual change go even further: as the service sector has an easier time passing on prices to the consumer, while the industry faces competition even from imports, the implications for inflation will soon be felt, as pointed out in studies by sector entities. Liberal professionals, media and telecommunications services are the most likely victims of this so-called simplification, as they would no longer have the alternative between the two regimes that currently exist.

Once again, protests on the streets (or from offices and sectoral offices) will be necessary to make themselves heard to prevent the government from taking another reasonable chunk of the results of this expressive sector of GDP. The history of complicating to profit, active in Brazilian life since always, once again threatens to repeat itself.

Article published in Diário de Notícias page 02 – São Paulo, Wednesday, November 27, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. Email: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The history and numbers are astonishing. Every day, 46 tax rules are issued at the three levels of public administration, with the municipalities being champions in this unacceptable bureaucratic duel, which is disproportionate from productive activity. Since the beginning of the last century, the monarchy was abolished and the Republic was consolidated, the matter has been debated, both in technical terms and in political and humorous criticisms.

Monteiro Lobato, the creator of icons of national literature, in 1922, year of the creation of the Income Tax in Brazil, once again sharpened his verve and wrote an acid critic about the new tax, weaving an analogy between the giant country and the Lilliputian dwarfs who inhabited the imaginary land of the novel The Travels of Gulliver. The Income Tax would be one more of these dwarfs to suffocate and strangle the giant country or, more modernly, the productive activity.

It is impossible to say that nothing has changed, on the contrary. Everything has continued to change for worse since those distant 1920s. The cake has grown, fermented and threatens to overflow the continental oven where it is inserted. In Brazil, there are about 5,500 municipal tax codes, in addition to 27 similar at the state level. In addition, besides the effective payment of taxes, companies must complete 2,200 form fields per year and are required to send a series of declarations, guides, reports and deeds to the Tax Authorities. And they pay the taxes, on average, 25 days after the sale and receive the invoice after 60 days. Not to mention when they should pay the Tax on Circulation of Goods even before the product leaves the company.

A few have managed to overcome the borders of criticism of this tax bureaucracy and put into practice some ideas with the aim of simplifying the national tax system. The most emblematic case refers to the creation of the Extraordinary Ministry of Bureaucratization by President João Batista Figueiredo, in July 1979, under the unmistakable inspiration of the then appointed minister Hélio Beltrão. Ironic quotes that he used to repeat in his travels around the country remain legitimate today: Nobody lives in the Union, the citizen lives in the Municipality, he emphasized, in defense of the thesis of decentralization, purge and cleaning of the tax bureaucracy. Where did so much effort and art go? It is not difficult to assess, given the current outlook of the matter and the inevitable finding that the government machine remains totally averse to any evolution, wherever it comes from.

Another recent historical reference (just a quarter of a century) is the current Constitution, classified at the time as a citizen's constitution, voted and promulgated as a new and modern parameter for the country of the future, which we all intended to be creating. Since then, 4,785,194 rules have been published, among complementary and ordinary laws, provisional measures decrees, constitutional amendments and other jewels of the national legislative crown. Of this total, 6.5% or 309,147 are tax rules collected until the last day of September 30, according to a study by the Brazilian Institute of Planning and Taxation. Since then, it has certainly increased.

These are specific observations on some aspects of this gigantic universe, which today gains more accentuated contours thanks to the expansion and diffusion of electronic means of communication, still incipient for just over a decade, but today revolutionizing communications, retiring stamps and certificates of several genres that also infest this universe.

Studies, seminars and meetings aimed at debating this frankly enigmatic universe, even for doctors in the field, are carried out with greater frequency, but, unfortunately, without expressive concrete results in the daily lives of ordinary citizens and in the business lives of those who actually build national wealth. There are those who even affirm the total lack of political will to face the pygmies who threaten to devour the sleeping giant of the gentle mother beloved country. Or a new Hélio Beltrão of the third millennium.

Article published in Diário de Notícias page 02 – São Paulo, Wednesday, November 13, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

Due to ironic but real circumstances, which transform the tax universe into a complex patchwork and contribute to confuse and torment the lives of those engaged in business, success in a modest start is a sign of bureaucratic complication and increased official bleeding on the income earned by this achievement. Winning just does not pay off, as logic should be in a universe flagged by free enterprise and the foundations of capitalism.

The situation, if analyzed only from the point of view of greater efficiency and profitability in the enterprise, would even be reasonable, were it not for other circumstances that complicate this situation. The main one refers to inflation, which has always been disregarded, in maintaining the ceiling of BRL 3.6 million per year for inclusion in this simplified regime.

With the lack of correction of this ceiling, the situation also begins to worry businessmen and scholars of the subject who defend, among other theses, a kind of gradual exit from this regime, which would not disturb the business of small entrepreneurs, as today.

In the State of São Paulo alone, according to Sebrae estimates, almost 1,400 companies should exceed this ceiling this year, leveraged both by success and real growth and by simple inflationary correction. The amount currently applied has not been corrected since 2011 and requests from several business entities regarding measures in this direction continue to be lost in the unfathomable labyrinths of the Brazilian bureaucracy.

For a better assimilation of the scope of this bureaucratic obstacle, it is worth mentioning that in this simplified regime, the small business owner collects at once the Corporate Income Tax, the Tax on Industrialized Products, the most popular ICMS - Tax on the Circulation of Goods and the familiar ISS - Service Tax. And the agenda does not end there. The following contributions are also collected by the same package: on net income (CSLL), on the financing of social security (Cofins), social security employer contribution (CPP) and contribution to PIS/Pasep.

If this list of taxes were not enough, the burden is usually less than in traditional regimes, although the proportion of this difference varies from case to case, as it depends on factors such as the size of the payroll of each company. No more arguments are needed to understand the struggle of these entrepreneurs to continue in this differentiated regime, expending energy and creativity to reduce or even mystify profits, when they should be being used in the growth of business. They almost always give up investing and creating to expand their business with the inevitable consequences for the country's own growth.

Failure to move forward is only one of the consequences of this threat of execution that hangs over those who cross that border. There are other resources that the most daring ones are using to stay in Simples and, at the same time, expand business and profits. One of the most voted by the entrepreneurs is the so-called corporate quick fix, which is nothing more than registering a second or even third company in the name of relatives or friends, a trick considered illegal by the tax authorities and even dangerous for the company itself. Without considering, still, lesser chances of obtaining cheap financing to grow, since it cannot present attractive billing for eventual investors.

There are some steps to expand the number of sectors benefited by Simples, which should range from transportation companies to consultancies, but nothing is said about the consequences of this sudden death of those already sheltered by the system. The most reasonable idea would be a gradual escalation in the cut of advantages, without the undeniable impact of the abrupt termination of the differentiated system for those who are already inserted in it and are led to live with and even cling to a revenue stipulated by the entrepreneur, an aberration in the free market capitalist system. Finally, it is the well-known programmatic contradictions of national life that, we all know, hamper the development of Brazil and the construction of the wealth that the country and its people aspire to.

Article published in Diário de Notícias page 02 – São Paulo, Thursday, November 7, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The recent and still unresolved pending issue regarding the updating of the Generic Plant of Values of the municipality of São Paulo, in almost random, but substantial numbers, brings the Land and Urban Tax - IPTU back to the discussion. Considered less exposed to the media spotlight than other taxes that affect the pocket of Brazilians, it has quite interesting and unknown characteristics to the majority of those who collect it annually.

It is a constitutionally imposed tax and the possession of property located in an urban or suburban area is a taxable event. They are individuals or legal entities that maintain this possession for a fair title and their main purpose is to obtain financial resources for the municipalities. Only those legally responsible for this sphere of public administration have the competence to apply it and determine its value.

The IPTU has a prominent role in economically more developed municipalities and thus can be used in situations different from its initial destination, even contributing to remedy budgetary shortfalls arising from other administrative issues. This is the case of the recent stir that São Paulo faces and that occurs similarly in other municipalities, with less media impact for obvious and even political reasons.

São Paulo, in times not so remote, faced such a discussion twice, during the terms of ex-president Jânio Quadros and mayor Luiza Erundina. Both, in different times and situations, tried to increase the tax rates in a different way. Just as now, without substantial technical arguments and with logistical discrepancies visible even to those ignorant to the subject.

First, it is necessary to understand the socio-political structure of this type of tax, which has the social function as its primary objective, but in essence it is typically fiscal and thus serves more to obtain resources to support the city's administrative and political machinery. In principle, it should focus on the better-off financial strata - owners of more valued properties - in favor of improving urban conditions on the peripheries.

This approach, nowadays and in most Brazilian cities, has lost support in view of the occupational deterioration of large centers, of which São Paulo is a typical example, but is spreading to other metropolitan regions of the country. Thus, it became essential to study and update the Generic Values Plan - PGV before any reasonable attempt to increase the tax. The only acceptable exception would be the mere updating of indexes only sustained by the inflation gap, as occurs in many situations and is simply ignored in others.

The fact that the property has been valued for years, the primary argument used to support the eventual increase in the tax, does not mean that the financial capacity of the owner has increased in the same proportion. The income of the majority of this portion of residents and their tenants has not risen in the same proportion, this not taking into account the enormous number of owners of residential properties of good geographical situation and reasonable size are now dependent on pensions, public or private. The achievement of the property took place within another social and family context, completely different from the current one.

It is worth remembering, by the way, that the basis for calculating IPTU is the venal value of the property on which the tax is levied. This value must be understood as its cash sales value or forced settlement, differently from the market value stipulated by more individualized trading and interests and even the acceptance of other properties in exchange. Even the owners tend to be surprised by the difference between what they consider to be worth their assets and the quantum fixed in the respective bills. Thus, the so-called social function of the tax is completely diluted in the face of other interests of the administration, including the search for resources for debt payments.

It is also worth mentioning that, in most medium-sized municipalities, the IPTU stands out among the collection sources, often appearing as the main source of administration resources, since the ISS - Tax on Services, another municipal tax of considerable importance, has a smaller taxpayer base in such municipalities. The discussions around the increase considered to be an exaggeration of that tax in São Paulo, now eclipsed by other official decisions of great repercussion, such as the bidding for pre-salt fields, do not detract from the importance of the need for a revaluation of the IPTU, in view of the socioeconomic outlook of the cities and their inhabitants today.
Article published in Diário de Notícias page 02 – Paulo, Tuesday, October 29, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

By Bárbara Pombo

The Federal Regional Court (TRF) of the 1st Region, based in Brasília, defined that the Tax on Services (ISS) should not be included in the calculation of contributions to PIS and Cofins. The decision of the 4th Section, which brings together the two classes of tax law, standardized in favor of taxpayers an important discussion against the IRS. It was the first time that the section analyzed the matter and the score of the trial - five votes to one - surprised lawyers who defend the companies. In the other four TRFs in the country, the discussion is favorable to the tax authorities.

However, this is the largest of them, encompassing 13 states and the Federal District, in addition to admitting actions by parts of other states against federal agencies. The judges understood that the ISS is collected from the municipalities by legal obligation. Therefore, it could not be considered taxpayer revenue.

In practice, they ensured to a telephone company, the author of the appeal, a reduction in the value of contributions based on a smaller calculation base. “Taking into account all the revenues obtained by the company, it remains evident that a tax withheld at source by the taxpayer cannot be considered billing”, says the rapporteur, the judge summoned Rodrigo de Godoy Mendes, during the vote. Only Appellate Judge Reynaldo Fonseca voted in favor of the Treasury. For him, the ISS is included in the price of services, so it should be included in the company's billing, the basis for calculating social contributions. "The reasoning adopted for including the ICMS in the calculation of PIS and Cofins is also applicable to include the ISS", he says.

More than the arguments raised, however, the importance of the judgment lies in the standardization of the discussion in the TRF, says the lawyer of the telephone company, Giuseppe Pecorari Melotti, of the office Bichara, Barata & Costa Advogados. The 7th Panel of the Court has decided in favor of the Tax Authorities, while the 8th Panel has adopted a favorable understanding to taxpayers. "The tendency is that both classes will adopt, from now on, the ISS exclusion thesis.” After winning in the first instance, the telephone company lost the discussion in the 7th Panel of the TRF of the 1st Region. The company then entered into infringing embargoes to discuss the matter in the 4th Section, which brings together six appellate judges. In the TRF of the 3rd Region (SP and MS), only one of the two classes of tax law has already admitted, in a decision published in June, the exclusion of ISS from the calculation of PIS and Cofins.

In other courts, the jurisprudence is totally favorable to the tax authorities. For lawyer Luiz Rogério Sawaya Batista, a partner at Nunes & Sawaya Advogados, the decision is important in view of the numerous precedents favorable to the Tax Authorities. "In addition, I find the discussion involving the ISS more difficult than the dispute over the ICMS because there is no rule that signals or not the inclusion of the tax", he says. In the case of the ICMS, there was a summary of the extinct Federal Court of Appeals (TFR) that determined the inclusion “in the PIS calculation base the portion related to the ICM”. Despite the taxpayers' victory in the TRF of the 1st Region, it will be up to the Supreme Federal Court (STF) to resolve the dispute, through the appeal of Viação Alvorada.

In addition to the ISS, the ministers will have to judge a similar discussion on the ICMS that has been going on for years in the Court and involves about BRL 90 billion. In 2006, the ministers initiated the ICMS judgment through an extraordinary appeal by an auto parts distributor. Six ministers voted in favor of the company and Minister Gilmar Mendes asked for a view. A year later, the Union filed a declaratory constitutionality action (ADC) No. 18, which depends on the release of the vote of the rapporteur, Minister Celso de Mello, to be judged. The STF also recognized the general repercussion of the theme in an appeal by Imcopa. The Supreme Court's judgment on the ICMS is cited, as a basis, in decisions by the TRFs of the 1st and 3rd regions in favor of the ISS exclusion. “The factual and legal identity between the subjects allows the reference [to the judgment not yet finalized] to corroborate the thesis defended in the case”, says the summoned judge Rodrigo de Godoy Mendes, of the TRF of 1st Region. For lawyers, the decision of the TRF of 1st Region signals to the STF the need to judge the issues as soon as possible. “The divergence between the courts results in a lack of equality between companies located in different regions”, says Giuseppe Pecorari Melotti. Sought by Valor, the General Attorney of the National Treasury (PGFN) preferred not to comment on the TRF decision.

Source: Valor Econômico - Legislação & Tributos - São Paulo, Friday and weekend, October 04, 05 and 06, 2013.

Dimas Alberto Alcantara*

The occurrence of debts with the Federal Revenue Service by companies that fall under Simples Nacional has caused their exclusion from this tax regime almost automatically. It is unnecessary to emphasize the damage caused by this decision to an ever-greater universe of micro and small companies spread throughout the country in the most diverse segments of economic activity.

If the harmful effects caused by this way of facing with a negative economic situation were not enough, it is particularly damaging to the taxpayer, the Revenue Department faces the basic and polished principle that constitutes the essence of creating this differentiated treatment to a broad-spectrum economic activity model in the current world. Favoring the expansion of a business universe that benefits not only the economy as a whole, but millions of families that use businesses of this size for their own subsistence.

More than that, this measure is illegal since it directly violates the Federal Constitution, which ensures favorable treatment for small and medium-sized companies, while also disobeying the principles of installments, proportionality, social function of property and free competition, capitulated in articles 170 to 179 of the CF, as well as the right to freedom of exercise of the profession and economic activity, as expressed in art. 5 of the same magnum diploma.

Justice has repeatedly understood that such act of the Revenue is illegal, which excludes or does not keep the taxpayer in the program at the national level and, as a result, ends up causing more damage in the universe of regional Simples, also quite used for different and countless activities, including by professionals from different specialties.

Through a judicial process, companies that fall under the Simples Nacional regime and were excluded from it because they are in debt to the IRS have been able to retroactively reinstate the date of the exclusion. The understanding that underlies these decisions is based on the fact that the tax authority has other alternative measures to promote the collection of its debts, through administrative processes and tax foreclosures, legally provided for the same purpose.

The immediate exclusion of the differentiated regime for default means a coercion to the debtor in the form of indirect collection, which starts to replace the tax enforcement and illegally takes from the taxpayer the right to legal and adversarial proceedings, fundamental elements to the national legal framework. There are countless reasons that justify the decisions already made, but the main one lies in the flagrant unconstitutionality.

Small and medium-sized companies that have fallen into this tax trap must request the Judiciary to recognize this right and be reinstated it in Simples Nacional, going further in its legal pretensions. The measure must be applied retroactively, remitting the effects of the decision at the date of the exclusion, thus allowing an administrative proceeding claiming restitution or compensation of the amounts overpaid in that period, due to the differentiation of the tax regimes used by each system.

The taxpayer thus framed must assert their rights, not passively accepting - as many still insist on doing - proven fiscal attitudes that are illegal and coercive of the basic business activity of the Brazilian economic system.

Article published in Diário de Notícias page 02 – São Paulo, Wednesday, September 18, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

One of the biggest and most scandalous official defaults, the colossal debt of BRL 94 billion that no one assumes, mayors and governors enter and many others leave, it remains on the margins of really concrete and appropriate decisions to settle this monumental and old cheat of the public power over the citizens.

The revolt is not so great, nor has it yet hit the streets like other equally fair demands that have managed to awaken public opinion and shake off official inaction and omission. They know of the court-ordered debt, with the due exceptions of practice in the diminutive stronghold of the well-informed Brazilians, only those who feel in the pocket and in the flesh the lack of resources, often coming from their own work as civil servants.

This universe, it is true, is restricted to a part of the enormous portion of creditors of the public power spread throughout Brazil. In this context, the Union owes nothing, except through the lack of adequate precepts to govern the matter in legal terms, as this is its duty. After all, a court-ordered debt payment is an order issued by the judge to the administrative authority to make a payment to a creditor. It may be due to expropriations, tax credits, indemnities, salaries and, according to data from the Ministry of Finance, today it reaches the value mentioned above, without the authorities being able to even assess this mountain of, let's say, factual money.

Faced with this enigmatic pyramid, which only grows, the proposals for equalization of matter also grow. It continues with the Federal Supreme Court, which declared in March the court-ordered debt payment rules approved by Congress in 2009 unconstitutional. For them, a period of 15 years was set for the debt to be settled, stipulated a percentage of the budget - 1% and 2% - for these payments and allowed auctions for governments to pay court-ordered debts with discount.

According to the Supreme Court's current decision, everything went back to previous levels, decidedly incapable of meeting the colossal and growing demand. The court-ordered debts must then go back to being paid - when they are paid - according to article 100 of the Constitution - within 18 months after the final and unappealable sentence in chronological order. No privileges to the king's friends or even poor widows and orphans of public servants. But nothing prevents them from being thrown into the archives, as they are today.

There are promises that the STF will return to appreciate the matter, who knows when. Meanwhile, ideas that deserve to be analyzed continue to emerge, despite the inexplicable inertia of entities representing society, an inertia that may start to be shaken by the still inexplicable protests of the population.

One of them, quite suggestive, but requiring more analysis and political-economic details, refers to the federalization of this immense debt. It surprises, at first sight, the thesis of the Union assuming a commitment that is not its own, without seeing any compensation. However, it is worth considering the reigning anarchy among the most different debtor profiles, from the city of São Paulo - BRL 17.7 billion -, to one of those small municipalities, more representative of the disordered creation of new political cores throughout the country, which they collect nothing, but they always end up owing something to someone.

Within a well-structured economic and legal framework, the Union would create order in this disorder and with administrative and political skill it would be reimbursed little by little from these disbursements, pulling out more from the rich, i.e. from big cities and states, and, who knows, even forgiving the neediest and the poorest, paying the bill for a kind of socio-political charity. And that will gain votes.

The proposal is explosive, but it deserves to be analyzed and discussed, as long as there are public men - or women - who have the audacity to set up and run this new gear on the ground of court-ordered debts, which explosion will not take long, if it continues as it is.

Article published in Diário de Notícias page 02 – São Paulo, Monday, August 19, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

Relegated to 121st position in a World Bank ranking that measures the ease of doing business in the 185 different economies studied, Brazil is still a long way from getting a hand in this immense universe of small and medium-sized companies that stretches across the country. Absolutely totalitarian number in relation to the larger corporations and which is designed to accentuate itself given the directions that the economy has been taking. The medieval bureaucracy remains unscathed in the third millennium and, interestingly, far from the protests that won the streets, thus safeguarding the tangle of attitudes that hinder the lives of millions of Brazilians.

It was not only for political party interests that the Union created the Secretariat for Micro and Small Companies, giving it the status of 39th ministry of the current government. To continue ignoring this immense and productive hemisphere of the Brazilian economy would be one of those enigmatic official stumbles, which mark one or even more administrations. And more than that, it can even compromise the development of several generations.

The newly installed minister, barely took a seat in the new chair, defended the discussed release of Supersimples for businesses in all areas, according to the option of the interested parties themselves. Today there is an extensive list of sectors that are prevented from paying taxes by the simplified tax regime, even if it is a micro or small company. Most of them provide intellectual, technical, scientific, handcrafted or artistic services, without any logic in vetoing that a speechwriter, academic thesis reviewer or illustrator cannot use this system, as accountants and now even lawyers can make their business official.

Strictly speaking, the detailed study of the rules that govern the matter, including also the so-called Simples, with a more state scope and, therefore, differentiated according to the federative entity, creates a question that cannot be ignored: all this legislative arsenal, crowned by Supersimples simplifies and standardizes this universe more easily, or complicates the different equations that govern it?

In principle, the favorable response still depends on eventual regulations and ordinances that will come in tow of the others that already exist, as is usual in the national tax universe. However, political will and social demands, which in recent times have surprised even those most involved in the system, may end up generating really simplifying legal actions. After all, allowing an uncountable mass of wealth producers to remain on the margin of the official world, as it has been until today, does not only harm the Nation, but also causes all sorts of setbacks and even losses to its members. Also subject to fines, confiscation of products and various impediments, these wealth creators also cannot have access to credit and discount instruments that exist precisely to support and solidify productive activity, regardless of their size or revenue.

It is essential that class associations, political associations and the whole society articulate in order to transform the tax universe into something palatable and digestible for all segments, regardless of its size or capacity to generate wealth. And do not allow this stigma of mystery and difficulty to prevail in the matter, which persists today in the various activities. Supersimples and the new ministry can be the beginning of a new and modern posture of the country, for the good of the people and the general happiness of the Nation.

Article published in Diário de Notícias page 02 – São Paulo, Wednesday, July 31, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

Sneaky and less subject to criticism from tax law scholars, regulation is a kind of appendix to the legal norm that, far from rationalizing the life of taxpayers and companies, has become a key player to aggravate the burden of this immense tax burden on taxes that slow down the growth and hamper most productive activities in the country.

Suddenly, a mere ordinance regulating this or that system puts accounting procedures at stake and puts the life of a company in jeopardy, creating a legal uncertainty that contaminates business, hinders production, complicates receipt and delivery of essential items for the very subsistence of the business. It is the so-called hand brake that, when activated, causes productive stagnation that only serves to camouflage the real aspect of matter.

The practice of using these smaller instruments of the tax structure to alter this or that method of calculating amounts produced by both legal entities and individuals is widely disseminated, always generating more niches for the State to increase its revenue, with the aggravating factor that the use of these same resources almost always does not correspond to the needs of the population, which are clearly constitutionally established.

Brazil has one of the most complex tax structures in the world. The value of this paraphernalia created by laws, ordinances and regulations, in addition to being incalculable, is the main lever for the constant and significant increase in bureaucratic and administrative costs of all enterprises, regardless of the sector of activities or its size.

Small and medium-sized companies, considered as one of the most modern and intelligent ways to occupy and produce larger numbers of people arriving in the job market every day, do not escape this filigree network of second and third echelon devices, which confuse and bewilder even experts in the field. The ordinary citizen who seeks to establish as an entrepreneur, most of the time is obliged to put an end to this dream, in the face of this authentic asylum confusion that became the national tax system.

The decanted single tax, at first appears as a very reasonable solution for this situation. Again, what appears to be in reality is not. Even before any real action on the matter, the citizen observes the scythe fight in the dark between the federation and the States around the reform of the Tax on Circulation of Goods and Services - ICMS in interstate operations. And this is only a part, although an important one, of the wealth of contributions that the State imposes on national activities, the true economic engine of the nation.

A similar obstacle complicates the implementation of the law that determines the discrimination, in invoices, of taxes embedded in the costs of services or products purchased throughout Brazil. The determination is contained in a law approved by the Chamber of Deputies in November last year, then sanctioned by the President of the Republic and hitherto forgotten, run over for numerous reasons, including bureaucratic ones, as the government itself is unable to stipulate precisely how much of this or that tax falls on a loaf of bread or a dish of butter. And the merchant is the one who must go out of their way to try to discover the secret of the safe, which will soon have ordinances and regulations that will only further disrupt the outlook. A year of deadline granted for the real implementation of this requirement, has everything to send the matter to the crowded cemetery of the laws that do not work.

Criticism, now more than ever leveraged by the general protests that unexpectedly overwhelmed the population, may serve to finally bring about the so essential tax reform, also running through the corridors of power for some time, without any indication of coming to fruition. And that the flood of rules and ordinances that populate and disturb the lives of people and legal entities are also strictly determined. After all, for some time now, we have entered the world of information technology, while the government insists on limping in medieval practices, with no great prospects of really significant changes in the progress of these and other bureaucratic and asphyxiating processes in the economy and in the country itself.

Article published in Diário de Notícias page 02 – São Paulo, Friday, July 12, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The announced, decanted and necessary reform of the ICMS - Tax on Circulation of Goods and Services, now underway in the Senate, after a long and even exhausting journey through ministries, offices, state and municipal governments, threatens to return to square one. And, once again, put an end to this essential attempt to adapt part of the national tax system to the challenges of the new century and the economic changes that the different Brazilian regions are going through.

The explosion of popular revolt in recent days, the agendas of demands that soon extrapolated the now emblematic twenty cents from the tickets of public transport, inverted the order (if any) of the so-called official reform proposals. In this stunned situation, political reform practically put aside, among other fundamental reforms, tax changes of great importance, such as the controversial ICMS equation.

The political party that took over the project, even for controlling that House, does not allow the government to withdraw from Congress a project that reduces in practice the debt of States and municipalities and conditions the approval of one project to another. The government claims that this debt reduction by up to 45% violates the Fiscal Responsibility Law and also diverges from the commitment to present a Provisional Measure that creates a fund to compensate for revenue losses that would be caused by the reduction of the ICMS rates provided for in the original project of this reform.

The issue is complex, not only from the strictly tax point of view, but in its possible political consequences. The Plateau fears to upset the North. Northeast and Midwest, vital for the presidential re-election, but it tries to harm the South and Southeast, still the true engines of national income. It unabashedly privileges political maneuver to the detriment of the country's real interests. All of this, it is important to situate, before the popular explosion that can and must modify the most diverse focuses of the also different subjects.

To better understand the picture that was drafted yesterday, it is necessary to return to the beginning of everything. The project originally sent by the Executive proposed the gradual reduction of the interstate tax rates and, subsequently, the equalization of rates throughout the national territory, putting an end to the so-called “fiscal war”. The closure of the attractions that less developed regions used to attract companies, however, did not succeed in order to be able to settle the old dispute between developed States and those with an eye towards acquiring this same potential.

The initial text was rotated, modified, discussed in several instances, but until now the panorama has only changed in the percentage of each block. The rates, now 7% for products originating in the South and Southeast and 12% for those originating in other States, would be reduced to 4% and 7%, respectively. The 4% unification thesis, foreseen in the initial project, disappeared and ended up giving way to a new mix of rates, involving free zones in the North, agricultural products and natural gas originating in the South and Southeast, an undeniable return to square one and to the criticized existing paraphernalia.

From a political point of view, the government expressed displeasure with this new version of the reform and made it clear that, continuing things as they are now in Congress, the Executive can withdraw from the proposal, a possibility that is being strengthened every day, even more under the loud and unexpected popular pressure. After all, it means nothing for the occupiers of the central power to stay in the middle of a tax battle that in reality embodies much more the search for votes, capitalizing some in this or that region, and losing others, further on, or below Ecuador. And who knows, lose even all of them.

Give up the fray, leaving the Legislature to take care of the controversial issue, and only later - post-election - to return to the subject, is one of the most likely hypotheses to please the audience. The economy, in this case and once again, will pay the bill and society will deal with the loss.

Article published in Diário de Notícias page 02 – São Paulo, Thursday, June 27, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

In times not so distant, a society with little information such as the Brazilian accepted, without much discussion, the armor that transformed the jurisdictional provision into something to… be preserved from the critical observation of the citizens and even of the members of the other two powers, Executive and Legislative. The media, which are still not very influential on public opinion, for fear of possible reprisals from this Latinized and conceptually hermetic universe, which few understood, preferred to turn the eyes from what happened behind the scenes of the Judiciary.

Fearless and daring journalists and editors clashed with the so-called Third Power. Due to the lack of conceptual and factual substance of these assertions, periodicals ended up taking the blame, being apprehended and even prevented from circulating, with fines and punishments to their authors. In short, the general tonic was that keeping a distance was the best policy, even though this omission strengthened a shield incompatible with democracy and even with so-called human rights.

Even today, the concept that the citizen can only approach the Judiciary through a lawyer prevails, with few and modest exceptions. Even because the constitutional rule - article 133 - establishes that the lawyer is indispensable to the administration of justice. This requirement is dubious, generally interpreted only in the face of lawsuits and actions, but completely separate from  the decisions and planning of public policy and administration of the financial and operational resources of that same justice.

It is a universe that the overwhelming majority of citizens are unaware of, but encompasses about 16,200 judges in the three branches of Brazilian justice, state, federal and labor, only the latter more accessible than the others for, at least in theory, dismissing the presence of the lawyer, not always with very positive results for the parties in dispute. To represent the population, eventually candidate for some right before this formal universe, the Brazilian Bar Association (OAB) has 713 thousand lawyers registered on its staff, a number higher than most countries, which means little or almost nothing due to the reality of said jurisdictional provision.

Processes have dragged on for years and even decades, moving through different spheres and drawing on a range of resources absolutely inadequate to the modern world and to the technological achievements of most of the operating machines of the economy and human relations.

The gap between life in the third millennium and the Brazilian justice system shows every day that it is a real obstacle to the development of the country, which is so much announced and never actually achieved. Executive and Legislative, exposed to all sorts of criticism and analysis spread in an even frightening way by the electronic media of the new mass communication, have somehow been subjected to this positive transparency of actions and omissions in the command of national life. The Judiciary, however, remains armored, with few exceptions that only confirm the strength of this characteristic, also supported by the delay in using electronic means in streamlining processes and rituals that are also archaic and requiring a review of both the Judiciary itself and the other two that make up the triple democratic crown.

The question that cannot be answered refers to legally carrying out this transposition from the archaic to the modern, from the feudal to the cybernetic era and seek to make use of these achievements in order to really expedite the much-dreamed and necessary rapid and satisfactory judicial provision, both to the individual interests in dispute, and to the nation's own developmental desire.

Who and which bodies should and can lead this battle and which protagonists of national public life have competence and interest in facing this challenge, whether in the Executive, the Ministry of Justice, the Judiciary or the legislative sphere. Why not OAB itself raise this flag, as an autonomous professional body, but whose activity is basically linked to this universe, studying and debating a project to modernize this tangle of strands and which costs us a huge portion of the national income? And, it is still pleased to snooze lawsuits in the files and drawers of sleepy and unmotivated servers, judges, likewise little used to dealing with their districts and courts of passage, as well as all those who use this historic inertia to enjoy their profits and advantages?

It is a colossal challenge for all Brazilians and history will know how to collect its dividends if this inertia continues to prevail in the “splendid cradle”.

Article published in Diário de Notícias page 02 – São Paulo, Friday, June 14, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The first quarter of this year saw a significant increase in the number of requests for judicial recovery. According to data recorded by the specialized services, there were 247 requests, a record amount since the new Bankruptcy Law came into force in 2005. The growth of these numbers, however, does not mean that the matter is known by the business community, mainly medium and small, because the legislation that governs it is complicated and incoherent, with some provisions that cancel each other.

After all, what is and represents in practice this new costume for the old and widely known syndrome of financial illness that affects companies of different sectors and sizes, especially when the winds of the economy are not at all favorable to business and international crises are tangent even to countries until now reasonably immune to its aftermath?

Judicial reorganization, also called LRE, is an institute that the company can turn to when its financial situation reaches its limit. In seeking this solution in court and granted the request, it gains time and strength to coordinate the directions of its strategy in order to overcome the challenge. From this concession, the company has, among other things, suspended, overdue or due obligations, until the approval of a business restructuring and recovery plan. For that, it must have, among other requirements, more than two years of activity, maintenance of the production source and be able to present a recovery plan duly approved by the creditors.

The apparent simplicity of the process is more evident than the procedures of its predecessor, the bankruptcy, and covers, without distinction, micro, small and medium-sized companies, including multinationals. Such conditions do not, however, dispense advice from legal professionals and specific economic consultancy for each type of activity. Therefore, there is a greater chance that the indispensable recovery plan will be accepted by creditors and will really start the desired business restructuring. The micro-entrepreneur must understandably be spared from these two consultancies, being able to be represented only by a lawyer, since they are exempted from presenting the recovery plan, required for applicants from other levels.

Once the process was initiated, the law allows the payment of the debt in 36 consecutive installments, with a 180-day grace period, a reasonable period for the applicant to put everything in order. During this period, the lawsuits in progress are suspended, including all creditors, even for the company to continue operating and billing, including to be able to honor the commitments now undertaken.

It is evident that the apparent simplicity of this legal mechanism does not mean that its adoption does not require absolute control of all the stages stipulated therein, since bankruptcy remains the permanent threat of eventual non-compliance with the rules of the game, clearly and properly agreed. Thus, the constant participation of a legal professional will allow the company to perform its role better in the entire process and not just in the initial phase. Even because, it is always important to emphasize, the law also stipulates several situations in which the judge may declare bankruptcy, notably due to the breach of any obligation assumed in the recovery plan.

Concluding this simple and superficial analysis of Judicial Recovery, its protagonists must never fail to examine and monitor the evolution of national and international economic facts, as well as being attentive to the behavior of their respective consumer markets and price levels, which are beginning to be affected by inflation. It is an important and saving remedy, which prescription and doses must be well evaluated and respected so that, instead of saving the patient, it ends up accelerating their death.

Article published in Diário de Notícias page 02 – Paulo, Tuesday, May 14, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The creation of new Federal Regional Courts, approved by Congress and criticized by the controversial and media president of the Supreme Federal Court, Joaquim Barbosa, in addition to exposing cost values of the existing Courts, raises an aspect of the most extreme importance for the socio-political organization of the nation: the transparency of the acts of each of the three powers that integrate the Republic and, independent and harmonious, command and discipline the lives of millions of Brazilians.

Executive and Legislative, in democracies, are placed under the spotlight of public opinion, now expanded immeasurably by electronic media and social networks. All its members and everything they do or procrastinate, sooner or later, will be the subject of the people. And it spreads, according to the interest of the subject, causing heated debates and repercussions not always consistent with the real importance of the theme. Every day, with the advances of this contemporary communication, it becomes more difficult - although not entirely impossible - to hide information from the community.

The Judiciary, an important pole of this tripod, has always fled from almost all types of charge, as if composed of vestals enthroned in temples that ordinary people are afraid to enter. The figure of the magistrate, even because of the traditional dress worn in public acts inherent to his functions, always passes the idea of someone above other citizens and whose acts are also surrounded by the same halo. The legal semantics, full of expressions unknown to the general public, based on Latinisms that are now absolutely archaic, complete this social isolation.

New times, new customs, and a magistrate emerges and begins to subvert this tradition and does not skimp or quibble in expressing his opinions, as now in relation to the creation of four new TRFs by Congress. Joaquim Barbosa, today president of the Federal Supreme Court, a position obtained after a brilliant career, does not shy away from making his point very clear, shaking archaic structures and making other judges and entities that surround and even integrate the Judiciary power in turmoil.
Joaquim Barbosa is against the increase in the number of courts in PEC 544-A and makes it very clear that the installation of these Courts will cause an increase in public spending by BRL 1.3 billion per year, and an increase in the number of existing servers in the five TRFs already considered exaggerated by the minister. Among other arguments, he highlights that a recent survey by the National Justice Council reveals that only 27% of Brazilian courts have judged more cases than they received in 2012.

The conclusion is logic. Before increasing the number of these and other courts, it is imperative to streamline the functioning of the legal process in all its instances, the vast majority hampered by archaic procedures and very distant from modern electronic techniques around the world. The deadlines required for the provision of jurisdiction in Brazil go beyond any forecast and are indisputable proof that a wide revolution in the operating systems used by this Power is imperative, urgent and overrides any other initiative that is less comprehensive and only sectorized.

How to carry out this revolution is the greatest challenge facing the country. It can and even promises to start from the dismay of this magistrate, which begins to shed some light on a reality that most prefer to ignore. Except, of course, for those who take years and even decades to get some answer about postulated rights, in all the different spheres and issues submitted to the decision of that power. Updates and transparency, not only of the Codes and legal provisions, but mainly of the bureaucratic system that underlies any and all decisions.

Article published in Diário de Notícias page 02 – São Paulo, Thursday, April 18, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

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Dimas Alberto Alcantara*

The classification stamped in the title of these considerations on one of the most staggering problems of administrative management in the Brazilian State, in its different spheres, is unfortunate, but essential. The owed, but unpaid, object of national parody, materialized in the management of national public affairs, spreading from North to South of the country. The exceptions do not modify the analysis, as they are registered in municipalities that should not even have this emancipating condition, since they do not have their own sources of resources that justify such autonomy. Another discrepancy that is outside the scope of these lines.

Recent data, difficult to prove, but sufficient to offer some numerical dimension of the issue, inform that the total of these judicial debts in cities and states exceeds BRL 90 billion and involve not only contractors and service providers, but thousands of servers and victims of expropriations. The payment of these amounts has always been postponed under the allegation of lack of financial resources and, sometimes, when made, suspected of irregularities in the calculation of the final amounts.

As this liability was already huge in 2009, Congress approved Constitutional Amendment 62 that authorized the payment of these debts in up to 15 years, mainly targeting those of high value. The refreshment was short-lived. On March 14, the Federal Supreme Court declared this permission unconstitutional, reverting to the previous rule that stipulated a one-year payment period, dismantling schemes outlined by states and municipalities, including holding the discussed auctions for these debts.

Among so many criticisms, the incongruous lack of definitions is the equal treatment of highly differentiated conditions. To offer identical legal paths to municipalities such as São Paulo, Guarulhos and Guarujá, at the top of the scale of indebted in the State, to small towns that are not even on the maps is to ignore reality and demonstrate that the public authorities responsible for the nation's destinies are playing with it and with millions of Brazilians.

Interestingly, to further confuse public opinion, the plaintiff of the lawsuit against installments and auctions, the Brazilian Bar Association, signals that it will offer suggestions to avoid financial chaos in the most indebted states and municipalities. Other information states that the STF itself may give some encouragement to those involved in this legal and administrative mess. The reporting minister of the action against the installments should propose a new discussion on the scope of the decision and whether such a discharge rule in one year will only apply to the new court-ordered debts.

The reality of some factors linked here is only a part of the various developments of this controversial matter. The possibilities and consequences of these debts are countless, including for the debtor, the Public Power. The existence of these liabilities with court orders is an embarrassment to obtain funds from institutions such as the BNDES - National Bank for Economic and Social Development, although some debtors have already obtained positive certificates allowing credit operations to be carried out. Another singular addition to the sum of the interpretive diversity of the matter, joining the incredibly complicated situation that has become the billionaire question of court-ordered debts. And, unfortunately for those involved and Brazilians in general, nobody seems to be interested in formatting this tangle, which has been going on for decades and survives governments of different political orientations, without a solution.

Article published in Diário de Notícias page 02 – Paulo, Tuesday, April 9, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

Although still far from a definition, despite the rejection by Congress to the presidential veto, the discussion about the division of royalties from oil exploration contracts in Brazilian waters, brings up a relevant aspect of the tax matter, still little discussed between us. The political power that tax maneuvers attribute or extinguish as a result of the operations of public administration managers, in all strata, is almost always underestimated. Taxes have a lot of power, not only in the lives of people and companies, but mainly in the political configuration of society.

Most of the professionals in the legal and economic fields who are dedicated to decoding the intricate tax matters, here and in other countries, focus their studies in the accounting and financial area, almost always relegating the socio-political function to other human relations scholars. They work on numbers and they spread calculations and operations on them, almost completely abstracting from the beginning and the end of all this matter. It is the so-called “once a use and ever a custom”, although there is no demerit in this contest, not least because it comes from a tax attorney.

The recent struggle for pre-salt oil royalties brought headlines to the then unknown wealth at the bottom of the ocean, but it also highlighted a most interesting tax dispute. The fact is that the right to the Nation's assets, strictly , belongs to all Brazilians, although since colonial times their exploitation has been the privilege of the owners of the areas where they were discovered. So, it was with the gold from Minas Gerais, precious stones in different corners and more recently with other ores that could generate wealth in modern technological artifacts.

Good or bad, the taxes generated by these explorations were sent to the Court, in the past, and to the Union, when it was the Republic. The chunks of these riches grabbed by the Public Power were high and even generated rebellions that History portrays, not always with the tax aspect properly focused. However, effective and coherent political discussions on the population's rights to the real use of these national wealth, which are not few, are now gaining special prominence.

The discovery of oil in some parts of the territory did not raise major controversies over time. Until today, this modest exploitation fell to the landowners where signs of its existence were detected. The thing caught fire when the discovery of a still incalculable richness in the so-called pre-salt, more precisely in the oceanic depths, owned only by the name of the Brazilian territorial sea.

To what extent, however, can States and Municipalities close to these maritime platforms territorially take ownership of these riches? Located on the high seas, they strictly belonged to the Nation and their eventual production should be shared among all, even for inhabitants of the most distant parts of the country. Located on the high seas, they strictly belonged to the Nation and their eventual production should be shared among all, even for inhabitants of the most distant parts of the country.

There it emerges, with a crash rarely seen, the division of these proceeds, coming from some points of the Nation and reverted to it in the form of taxes, transformed into funds to be distributed according to the political interests of those in power. And without any concern with the amount of challenges that are already being faced by the States and Municipalities where the first extractions of the liquid arise. Meteoric increase in population, also in search of the so-called black gold, need for shelter and support for this huge migratory parcel, updating of outpatient and educational services, housing, waste disposal and so many other challenges of collective life, go to the space in the vision of the defenders of the national character of these taxes.

As if that were not enough, it should be noted the exceptional nature of the ICMS tax on oil, which affects the destination and not the generation of the product, as in other activities. There would remain the socio-environmental impacts caused by the oil industry precisely at the points where it is and will be explored. The other States and Municipalities will only benefit from the profits of this high-risk activity for the environment where it is developed.

It is undoubtedly a challenge that proves the need for greater socio-political concern in the elaboration of strictly tax architecture, both by the authorities and the operators of the matter within society.

Article published in Diário de Notícias page 02 – São Paulo, Wednesday, March 20, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

As old as the presence of man on earth, tax is a constant figure in history, under the most diverse nomenclatures and classifications. As soon as the human being started to gather in tribes or communities and discovered that the possession and exploration of the land were fundamental for the survival of the species and, as a result, an instrument to ensure the power of one over the other, this figure crystallized once and for all, it has endured all the conflicts and bad weather that mark our existence on the planet.

Income Tax, which in principle seeks to remove from the most well-allocated part that can be used to alleviate social inequalities, in democracies has some content and should even be relatively well assimilated, provided that it is within reasonable parameters. Punishing only those who create and produce, under the ideological guise of collective well-being, and under arbitrary conditions, is unacceptable for any minimally organized society. But well-structured and applied can really generate the expected collective benefits. Otherwise, it is just a sum of mistakes.

This is what happens with Income Tax among us. The table that supports the calculations of the amount of tax to be paid shows a lag of 66.4% in relation to inflation. In the last 16 years, inflation measured by the IPCA increased 189.54%, while the Income Tax table was updated by only 73.95%, generating a greater impact for those who are paid less. It means that, in simple and objective language, those with lower income are more burdened, precisely because of a tax scheme that seeks the long-dreamed social equality.

The data, released by the Union of Tax Auditors of the Federal Revenue - Sindifisco fully demonstrate that a taxpayer with a monthly income of BRL 3 thousand, for example, would pay BRL 29.44 in tax if the table had been updated by inflation. As this did not happen, this same taxpayer will have to spend BRL 129.39 in this year's declaration, i.e. 339.50% more. And why doesn't this gap also affect those who earn more?

This is because previously those who earned less were exempt. Now, without correcting the table, these taxpayers have entered the first rate of Income Tax, 7.5%. Whoever earns more paid a rate of 27.5% and continues to contribute to the same range. The gap, according to the same study, widened between 1996 and 2001, a period in which there was no readjustment. And in subsequent years, they were inadequate to be able to supply this vacuum.

Those who received up to nine minimum wages in 1996 did not pay Income Tax. Today, this limit is 2.62% of minimum wages, equivalent to BRL 1,637.12 and those who receive any extra money are already at the rate of 7.5%. It is unnecessary to emphasize that the account of this lack of control, as a result of the ineffectiveness of those responsible for the tax area of the federal government, falls on the least favored, which is also unacceptable in governments that are so popular with the populist and egalitarian vocation.

Now that the problem is well located, it remains to be seen who is to be debited, not only this fantastic breach of 16 years of gap in the Income Tax table, but to those who continue to live with the problem, without any solution. And leaving the taxpayer with the task of charging for the loss with more emphasis and noise, something that we still do not know how to do, either for ourselves or in the name of the country.

Article published in Diário de Notícias page 02 – São Paulo, Monday, March 18, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specializing in collective actions and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

It is difficult to understand the logic, even if only reasonable, that would have motivated the approval of a bill that obliges merchants and service providers to explain in the tax documents "the approximate amount corresponding to the totality of federal, state and municipal taxes, whose incidence influences the setting up of the respective sales prices. And, even more shocking, is to see this idiosyncrasy approved almost without blinking by the Presidency of the Republic.

Applause from advocates of general and unrestricted transparency in everything is even acceptable. The trend of political correctness provides support to facts and situations unusual and even shocking for lovers of logical reasoning, one of the pillars of tax administration and the economy itself. And this kind of analysis has been light for years from the conception of this generic invoice, the one that means everything and says nothing really positive to the taxpayer, besides proving to play more unknowns and traps in an already densely troubled tax universe.

In a message that accompanied the return of the bill to the Senate, for subsequent examination of the five vetoes opposed to the original, the Presidency justifies them and emphasizes that "the determination of taxes that fall directly on the setting up of price is difficult to implement and the sanction of these provisions would induce the presentation of amounts very discrepant from those effectively paid, in defiance of the very purpose of bringing adequate information to the final consumer" concludes the text.

Nothing against transparency, quite the contrary. It is essential in all Government business, not only in the collection of this gigantic amount of money, but especially in its use by the public authorities on behalf of society. It is under discussion, as it has always been, the accessibility of the taxpayer to the way and means in which these fantastic amounts are collected. And this generic invoice only adds much more pepper to this already uneatable sauce.

The first idea is that the goods are isonomically taxed along the route they make through the production chain, until they reach the shelves of the retail trade. The creators of this further thrust do not consider that identical products have different tax burdens, which depend on the State in which they are manufactured, the paths they travel, the tax regimes, five or six different links in the production chain. In order to stick to the simplest, how may the retailer print on his invoice or tax coupon how much the installments of ICMS (Tax on Goods and Services Circulation), ISS (Tax on Services), IPI (Tax on Industrialized Products), IOF (Tax on Financial Operations) PIS/PASEP, Cofins (Contribution for Social Security Financing) and Cide (Contribution for Intervention in the Economic Domain) represent in the amount that is being charged.

As they do not have the technological support for this adventure of extracting the generic invoice, as they sell turnips and eggplants in the corner greengrocery, the merchant will be able to put these amounts on signs fixed to the walls of the shop. Updated daily according to the ripples of each of these taxes. There will not be enough pictures, walls and paint to fulfill this mission.

Even more surprising is that the guarantors of this costly and impractical operation for trade in general, the immense majority spread throughout all corners of this country, at the same time advocate tax simplification, through another unknown, always postponed tax reform. It is a country of contrasts indeed, as many observers have said, and the tax universe, despite its alleged mathematical logic, does not escape this picture either.

Article published in Diário de Notícias page 02 - São Paulo, Tuesday, February 26, 2013.

* Dimas Alberto Alcantara is a tax lawyer, specialized in collective proceedings and director of Alcantara Advogados & Associados. E-mail: alcantara@alcantara.adv.br

Dimas Alberto Alcantara*

The insufficiency of internal and external controls in almost all state businesses is historical in Brazil. This reality, as well as the permanent absence of management perspectives, control by results and technical evaluations of public policies, embargo the administration of the sum of resources that the productive society provides to maintain the Government.

In this panorama is inserted the question of the court-order debt payment, debts the government recognizes to have with enormous parts of the population - individuals and companies - and puts itself above and beyond to enforce its part. Some legal provisions, obtained after a lot of charging and some fanfare from larger debts, are lost in an almost indecipherable web of different interpretations of the modest thematic legislation that tries to equate the matter.

The courts called to decide on the matter, in countless lawsuits that clog several jurisdictions, have different interpretations of what the legislation says about how to calculate the monetary restatement. In short, the debtors struggles to assert his rights and, when he does, he encounters another obstacle to actually receive the cash corresponding to his credit: the amount in cash of this sweaty political-legal ordeal.

At the end of the year, the National Court-Ordered Debts Forum (Fonaprec) announced the creation of a working group to study the standardization of this update, establishing legal parameters and a fundamental consensus so that the matter will in fact correspond to the rights in litigation. And no longer, as until today, a kaleidoscope of decisions and respective escape valves for the interested party, the Government, fleeing from its legal obligations, indefinitely delaying the solution of the matter.

The decision was made at a meeting of the National Court-Ordered Debts Committee, held at the headquarters of the National Council of Justice (CNJ) in Brasília. The group has an appointed date to complete its studies, set at thirty days from its creation, a period coinciding with the festivities at the end of the year and relatively short for the complexity of the task. Even so, the results are expected from the creditors of these debts and should be charged with insistence and permanent attention, to avoid only the production of more and more structural opinions and analyses that end up in the archives.

With the same objectives, by an ordinance signed by the president of the organization, members of two permanent committees of the Forum would be designated: Permanent Commission for Institutional Affairs and Permanent Legislative Commission. While these bureaucratic provisions are slowly moving forward, creditors in the different units of the federation and the social security sector still have the right to complain and seek to make their voices heard, which is still not very eloquent until now.

The legislative representation, House and Senate, which constitutionally must reflect the voice of the people in defense of citizens' rights, ignores what happens in the other two poles of the governmental tripod and pretends to have nothing to do with the matter. It is impossible to predict for how long this inoperativeness will continue to harm a large part of Brazilians, and things will continue as they are.

Article published in Diário de Notícias page 02 - São Paulo, Friday, 11 January 2013.

* Dimas Alberto Alcantara is a tax lawyer, specialized in collective proceedings and director of Alcantara Advogados & Associados.

E-mail: alcantara@alcantara.adv.br