Economic Impacts of Possible Corrections to Withholding Income Tax Rates in the Brazilian Internal Environment

Abstract

The central theme addressed is the economic analysis caused by the absence of adequate corrections in the IRRF rates (income tax) between the period 2007 to 2017, through the IPCA index (consumer price index), to maintain or increase social well-being, the population's disposable income. taxpayer and consumer purchasing parity. From the data collection and applicability of the research methods, it was found that the contributing families collected 180 billion reais more in taxes. Through econometric models, with statistical significance of 1% and at most 5% in the variables, the Breusch and Pagan tests were used, and the adoption of the Pooling method for data extraction. After the analyzes, the models demonstrate in a crystalline way the reduction of disposable income by 0.0728%, of national savings by 0.0862% and in consumption by 0.0532% for each 1% increase in the new amount collected from taxes. Leading to a minimization of the declarants' well-being and how this value, if entered in the productive means, would contribute to the increase of economic indicators, however, according to the research purpose, the current IRRF table that should be in force is presented.