SAO PAULO, June 12 (Reuters) - Lawmakers from Brazil’s ruling party plan to introduce amendments to a draft bill that would increase taxes on commercial banks, citing the need to raise revenues to reduce the government’s budget deficit, the newswire service of Valor Econômico newspaper reported on Friday.
More than 12 amendments to an executive decree known as MP 675 have been proposed by members of the Workers’ Party, including raising the so-called CSLL tax on banks’ net income to as high as 35 percent from 15 percent currently, Valor said.
Introduction of the amendments would likely spur a heated debate on the issue in Congress. Taxes that do not require a new law to be raised, such as the CSLL, are appealing to lawmakers as they allow changes to be passed more rapidly, analyst Eduardo Nishio of Banco Brasil Plural said in a client note on Friday.
Members of the left-wing Workers’ Party, which is the party of President Dilma Rousseff, have been at odds over whether they should support Rousseff’s fiscal tightening plan, which also includes spending cuts. Valor said that some party members, including high-profile Senator Walter Pinheiro, back a tax hike on banks because it could soften the impact of Rousseff’s fiscal plan on the poor.
Efforts to contact the Workers’ Party and Pinheiro for comment were unsuccessful.
Banking shares fell on the news.
Shares in Itaú Unibanco Holding SA shed 1 percent, while those of Banco Bradesco SA dropped 1.4 percent.
State-controlled Banco do Brasil SA shed 1.1 percent, while investment banking firm Grupo BTG Pactual SA fell 0.5 percent. (Reporting by Guillermo Parra-Bernal; Additional reporting by Paula Arend Laier in São Paulo; Editing by Peter Galloway)