LatinNews Daily - 07 July 2023

* Brazil’s lower house of congress has approved the main text of a government-backed bill to reform the country’s tax system, in a major boost to the economic agenda of President Luiz Inácio Lula da Silva’s administration. Since the legislation would entail constitutional reform, it needs two separate votes in each house of congress before it can be fully promulgated. In the lower house, it passed the first-round vote by 382 to 118 and the second round by 375 to 113. The main provisions of the bill would include merging various consumption taxes into just two taxes on goods and services – Imposto sobre Bens e Serviços (IBS) to be levied by state governments and Contribuição sobre Bens e Serviços (CBS) levied by the federal government. Since a draft of the bill was first submitted to congress on 22 June, the legislation has been amended, with added provisions such as a zero tax rate on basic food items. The lower house still needs to vote on the proposed amendments to the bill before it can pass onto the senate, where it will face another two rounds of voting.