Capital over labour, white over black: the regressive Brazilian tax system p. 77). As a consequence, we can observe in Brazil the phe­nomenon of pejotização, or the migration from employ­er-employee relationships to an independent-contractor-­only hiring policy(Goto; Pires, 2022; Orair, 2022). POTENTIAL IMPACTS OF ALTERNATIVE TAX REFORMS In this scenario, Bottega et al.(2021a) and Bottega et al. (2021b) simulate the impacts of an eventual elimination of the unjustified privilege concerning distributed profits and dividends. Considering alternative tax rates of 15 per cent and 20 per cent, Bottega et al.(2021a) find that a profit and dividends tax would not have a substantial effect on Brazil’s Gini coefficient. Even so, according to Bottega et al.(2021b), a 15 per cent tax rate on profits and dividends plus an addi­tional tax rate of 35 per cent with respect to IRPF for the top 1 per cent 10 could generate R$ 46 billion(around US$ 9.2 billion in September 2023) in tax revenues. In other words, even if a progressive tax reform has limited capacity to directly reduce inequality, it may introduce a new source of revenue to defray government expenses, and in particular redistributive policies, including monetary transfers such as Bolsa Família, known for their success in mitigating extreme poverty and reducing inequality(Soares et al., 2007; 2009; 2010; Barros et al., 2007; Silveira, 2010; Hoffmann, 2013; Silveira et al.; 2020; 2022). Silveira et al. 10 People with monthly income above R$ 26,857.00 (around US$ 5,371.00 in September 2023). (2022) show how the Brazilian government expanded its ca­pacity to redistribute income through social expenses during the first decade of the 2000s: transfers and taxes reduced the Gini coefficient of market income inequality by 15 per cent(POF 2002–2003) and 21.8 per cent, respectively(POF 2008–2009). Moreover, government spending on public services such as health and education has a significant im­pact when it comes to reducing inequalities, as these ex­penditures benefit low-income strata disproportionately(Sil­veira; Palomo, 2023). But even if we consider a fiscally neutral tax reform, the redis­tributive potential offered by a profit and dividends tax(15 per cent or 20 per cent) is substantial: such an increase in tax rev­enues could secure a corresponding reduction in consump­tion taxes. Cardoso et al.(2022) simulate these effects, show­ing that such a reform would have a net expansionary effect on GDP(1.2 per cent in the case of a 15 per cent tax rate, and 1.9 per cent with a 20 per cent tax rate), since it stimulates consumption. Consequently, even if the reform were fiscally neutral, it would have a positive effect on tax revenues. More­over, it would promote an expansion of employment(2.14 per cent and 3.25, respectively) and increase the disposable in­come of all income brackets, except the highest one(above 30 minimum wages), in which 82 per cent of income derived from profits and dividends is concentrated. Another tax reform that has begun to gain traction during Brazil’s temporary presidency of the G20 is the creation of a minimum global tax rate on billionaires. This proposition originates with Chancel et al.(2022) idea of implementing a minimum global tax of 2 per cent on the wealth possessed by this same group. Along the same lines, Martins, Arthen Graph 7 Effective Excise Income Tax – Current and After Wealth Tax on the top 0.2 per cent 15 Effective Excise Tax (%) 10 5 0 75–80 80–85 85–90 90–95 96 97 98 Position in Income Distribution(%) Current 2 per cent Wealth Tax 2.5 per cent Wealth Tax Source: Made-FEA/USP(Martins, Arthen and Gomes, 2024, Graph 5) 9 99 99.01 99.81 –99.8 –100 3 per cent Wealth Tax