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More Taxes Just Increase Pressure on Companies and Citizens While Privileges and Fiscal Deficit Remain Untouched, Warns Economist Fernando Ulrich
The debate about taxes has returned to the center of the Brazilian economic agenda, but experts claim that increasing the tax burden does not resolve the country’s fiscal imbalances. Economist Fernando Ulrich criticizes the excessive focus on revenue collection and warns that the solution does not lie in asking more from society, but in cutting privileges and reducing public spending.
According to Ulrich, the discussion about taxes ignores the essential: the weight of the state apparatus. He argues that Brazil has room to cut expenses in areas full of distortions and privileges, but the political choice has always been to increase collection, which poses a risk of suffocating companies and encouraging a flight of investments.
The Increasing Burden of Taxes in Brazil
Brazil already ranks among the countries with the highest tax burden in the world in proportion to GDP.
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For Ulrich, this level of taxation becomes unsustainable when combined with inefficient public services and a bureaucratic system that stifles competitiveness.
He emphasizes that “more taxes do not necessarily mean more fiscal justice”, since resources are drained to sustain corporate benefits and political privileges.
Meanwhile, companies that generate jobs face increasingly smaller margins and little predictability about the future.
Fiscal Deficit and Ignored Privileges
Fernando Ulrich points out that the real problem lies in the growing fiscal deficit, driven by mandatory spending and a structure of privileges that rarely makes it to the adjustment agenda.
For him, the claim that the budget is “rigid” does not hold up against the number of benefits that could be reviewed.
“There is always room to cut privileges before increasing taxes”, says the economist.
He reminds us that distorted subsidies, special pensions, and corporate benefits remain untouched, even in a tightening fiscal scenario.
Risk of Company and Investment Flight
The insistence on raising taxes without addressing the privileges of the system, according to Ulrich, creates a real risk of companies fleeing the country.
Investors seek predictability and legal security but find a hostile environment where new rules and obligations arise each year.
This scenario threatens national competitiveness in the face of international competition.
Ulrich warns that if the trend continues, Brazil could see a loss of human and financial capital, further weakening the economy in the long term.
Alternatives to Rebalance Public Accounts
The economist advocates for an agenda based on spending cuts and privilege reviews as an alternative to increasing taxes.
This approach, he argues, would not only relieve the productive sector but also restore the country’s credibility in the global arena.
For Ulrich, the key lies in a leaner state, focused on essential services, rather than a model that tries to sustain inefficient structures with more revenue.
He states that only by doing so will it be possible to avoid new cycles of indebtedness and recession.
Fernando Ulrich’s message is clear:
“It is not by increasing taxes that Brazil will resolve its fiscal crisis.”
On the contrary, this strategy only worsens the loss of competitiveness and the distrust of the private sector.
And you, do you believe that Brazil should focus on cutting privileges before increasing taxes? Do you think that this tax pressure could truly lead companies to leave the country? Leave your opinion in the comments — we want to hear from those who live this reality every day.
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