In 2007 the Brazilian government proposed fundamental changes to its tax system. Reforms were aimed mainly at simplifying tax rules – eliminating certain taxes and bringing an end to the ‘tax war’ between Brazilian states – as well as a proposal to end the link between specific taxes and the exclusive financing of social policy initiatives. While the reform proposals were disappointing – given their complete failure to address equity issues – they also raised new concerns regarding the financing of the country’s health, welfare and social assistance programmes.
Brazilian CSO INESC saw the reform proposal as a window of opportunity to campaign for progressive tax reform.They invited five CSOs to participate with them in one of the government’s public consultations on the reform. As other groups became interested, a network of more than 100 organisations was formed – the ‘Movement in Defence of the Social RightsThreatened by theTax Reform’.They developed their alternative proposal ‘for a just tax reform’, calling for equity to be built into the reform bill and for social policies to continue to receive exclusive financing.
INESC along with five other organisations formed the executive committee of the network, with INESC providing the technical support and coordinating the lobbying.The network conducted lobby meetings with representatives from all political parties and managed to secure the support of a number of MPs. This enabled them to successfully push for a public debate inside the National Congress.
Key allies included the trade unions and churches, as well as a group of academics and state health departments. (While the government claimed there would be no losses to social programmes, the Ministry of Health calculated it was likely to lose US$9 billion).The public attorney’s office also assisted the campaign with several official requests for information from the government.
Although the campaign was not able to force more progressive amendments to the tax reform bill, its key success was in blocking the approval of the tax reform bill for now (though it is likely to reappear with the new government). Given that tax reform is now firmly established on the agenda of a large number of CSOs, INESC expects the network to continue to advocate for tax justice in the future.