In a statement, the Ministry of Finance explains that one of the proposals relates to the Industrial Tax Code. The document provides for tax relief by reducing the Industrial Tax rate, "bringing it into line with what is practised in the southern African region, where the average corporate tax rate is 27 per cent". However, the Government's proposal imposes the application of a rate of 25 per cent.
Although this proposal negatively affects the state coffers, the Government believes that this change will help companies to grow financially. Thus, they will be able to "reinvest their capital, thus generating more employment and consequently more consumption".
The executive's proposal also aims to change the rate charged in the agricultural and similar sectors: from 15 per cent to 10 per cent.
The law amending the Labour Income Tax Code (IRT) will also be discussed, which aims to "protect families with lower incomes and attribute greater progressivity to higher incomes, through the progressivity of IRT rates, as well as to increase tax competitiveness resulting from the lag in the levels of income subject to this tax".
In addition, according to the note of the guardianship, this proposal also provides for a reformulation of the scale of rates applicable to the income of employees with a view to "relieving the lowest incomes, maintaining the tax burden on intermediate income brackets and introducing greater progressivity on the highest incomes".
Possible changes to the General Tax Code will also be discussed, he adds.