When in July presented the preliminary draft reform of the IRS, the tax commission of experts appointed by the Ministry of Finance has proposed a fundamental change in the way it determines the collection of the IRS. Instead of the income of a couple be divided by two to determine the level and the rate payable, the children would also be considered in this calculation. Now, in the final proposal, the working group recommends that the dependent ascendants (grandparents, for example) are also encompassed in this “family quotient”. This is one of the changes that, according to information gathered by the PUBLIC, included in the final draft of the reform committee of tax experts has to deliver on Tuesday the Ministry of Finance.
is living with the condition that the taxpayers (in the same household), ascending confirmed the PUBLIC. Another requirement discussed by the commission shall establish that the person concerned has not exceed the minimum statutory pension (€ 259.4) income, such as the rule that applies today in deductions from taxable income.
To calculate the personal income tax rate, the taxable income of a household is currently divided by the number of taxpayers (for example, the income of a couple is divided by two). In the preliminary report submitted to the Minister of Finance on 18 July, the committee chaired by fiscalist Rui Duarte Morais proposed that a weighting of 0.3 points per child were added (in this case, the income of a couple with two children would be divided by 2.6).
In the final version of the document should also be proposed that the dependent ascendant is assigned a weighting of 0.3 points. Consider the situation of a couple with two children and an up living in the same household. Here, the taxable income of the family, currently divided by two (taxpayers) would be divided by 2.9 – the same calculation that is done, for example, in situations where the couple has three children, but no upward charge.
In the preliminary version, the working group has left out this solution to “simplify and especially to limit the budgetary impact of the rule change,” admitting that the measure be changed “on future. ” And yet last Friday, President of the reform commission admitted at a conference on the IRS, that the concept of household for tax purposes should be revised.
Include not only the children but also the upside was, incidentally, one of the proposals that the National Confederation of Family Associations (CNAF) sent the reform commission during the public consultation document. “The reform [draft] already gives interesting steps to give some support to the family. Consider the upside in the family quotient encourages that there is a more human care, because that would open doors to a larger number of families chose to take home the upside, “says the secretary general of the CNAF, Hugo Oliveira.
The change proposed in July by expert tax commission, near the French model, is not consensual and since then has generated an intense debate among tax experts. Even those points limitations and weaknesses recognizes that this is a profound change. Monica Costa and Joan Borralho, the consultant EY, even called the proposal ‘a’ Copernican revolution ‘in the taxation of families. “
To offset the loss of revenue to the State caused by the introduction of this” family quotient ” The committee has proposed creating a system of fixed and equal for all deductions -. further suggestion that divides tax practitioners
Instead of taxpayers are entitled to deductions in respect of expenditure on health, education and housing, to a certain threshold (EUR 1250 for those with an annual income between 7000 and 20,000 euros and zero for incomes above 80,000 euros), the commission proposes that the pass be fixed deduction per taxpayer.
For this, traced several scenarios, depending on what the Government wants to make up for “lost revenue” with the passage to the family quotient. In the most favorable scenario for taxpayers, the deduction was fixed at 330.95 euros per taxpayer and euros 321.95 per dependent.
One of the questions that overshadows what is the Government going to do about the IRS surcharge of 3.5%. The reform commission recommends a gradual reduction depending on budget availability. The Secretary of State for Fiscal Affairs, Paul Nuncio, has repeated that combating fraud and parallel economy could be decisive in reforming the IRS, but did not commit to lowering the surcharge. It is now the executive present retirement, what should happen on the eve of the release of the draft State Budget for 2015 (until 15 October).
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