The Securities Market Inspection Tax, its Inducing Effect, and its Limits

Abstract

If the tax derive from police power must be justified primarily based on equivalence (correspondence between the amount consumed in state’s inspection service and the amount paid by the taxpayer), the differentiation in the treatment among taxpayers concerning the securities market inspection tax (CVM Tax – Securities Commission Tax), whose value varies according to the taxpayer’s net worth, brings a relevant discussion about its constitutionality. With the provisional measure no. 1,072 of 2021, and the introduction of an inducing effect for the CVM Tax arising from the increase in progressivity, there are new challenges for analyzing the validity of the tax fee. This article examines the CVM Tax considering precedents from the Federal Supreme Court, seeking evidence limits on the tax incentive.