Government proposes new tax on PJs to combat pejotization
Government studies creating an additional tax for companies with a high number of PJs. Understand Dario Durigan's proposal to combat abusive pejotization.
TL;DR
- Brazil's Finance Minister Dario Durigan proposed a new social security contribution for companies with a high percentage of contract workers (PJs).
- The measure aims to combat abusive 'pejotization,' where workers are hired as PJs but function as regular employees, leading to lower tax collection and fewer worker protections.
- The government seeks to differentiate between legitimate outsourcing and companies using PJs to cut costs on taxes and social charges.
- A potential criterion suggested is that companies with 80% of their workforce as PJs might indicate a large-scale replacement of formal employees.
- Hiring PJs is legal in Brazil, but legal disputes arise when contracts don't reflect reality, such as direct subordination or controlled working hours.
- The new tax could increase labor costs for some companies, potentially leading to a shift towards formal CLT employment or price increases for consumers.
- There's a risk that genuinely autonomous professionals could be negatively impacted by broad regulations or intense fiscal inspections.