Brasília, 7/9/2003 (Agência Brasil - ABr) - If the tax reform bill does not improve the division of revenue, currently 63% for the federal government and 12.5% for municipalities, "instead of coming here every month looking for a handout, we will have a protest campout here in Brasilia right on the government's doorstep," warns Paulo Ziulkoski, the president of the National Confederation of Municipals (CNM) and the mayor of Mariana Pimental (RS).

Deputy Virgílio Guimarães (PT-MG), who will write the final text of the tax reform bill (he is known as the "relator"), says he is aware of the concern of the mayors. Earmarking part of CPMF revenue for municipalities is "more than a promise, it is something we believe in," he declared.

The CNM, 250 mayors strong, is in Brasilia for a vote on the services tax (ISS) scheduled for today. The mayors have been joined by 200 members of congress who support their position. "We need to support the mayors, they play an important role in the election of congressmen," explains Inocêncio Oliveira (PFL-PE), one of the leaders of a so-called Parliamentary Front which supports CNM grievances.

The bill up for a vote this afternoon expands taxable service activities from 101 to 208, leaving the tax at 2% to 5% of revenue (depending on the type of service), as it is now. Ziulkoski says the change will mean "doubling municipal tax revenue," but he adds there are still many other items in the tax bill mayors want to negotiate with the government. (AB)