Fallet, a partner at law firm Mauger Muniz Advogados in Brazil, tells ITR about his passion for tax law, the leaders who inspired him, and what makes tax cool
Someone asks you at a party what you do for a living. What do you say?
I would say that, in addition to being a tax professional, I am passionate about tax law, which includes being a lawyer, professor and judge. Considering the complexity of the Brazilian tax system and the importance of this topic for the survival of businesses in Brazil, most of the time I advise companies on their commercial strategies, not only acting as a legal advisor.
Talk us through a typical working day.
At the beginning of the day, I check all messages and emails, especially from foreign clients, considering the Brazilian time zone. After that, I typically read the various legislation and tax updates, which, oddly enough, are published daily in Brazil. Often this is followed by requests from journalists seeking to understand these various changes.
Afterwards, I head to the administrative tax courts to judge important cases and head to the office where I have internal discussions with the team about corporate operations, our legal opinions or tax litigation strategies, and meetings with clients.
As a professor, my day usually ends with LLM or MBA classes, as well as reviewing my articles for publication and the work of my students.
What are you working on at the moment?
In addition to the classes and the administrative courts, two cases have been attracting my attention today.
The first one concerns the international structuring of a new business by the largest telecommunications technology company in Brazil, which uses technologies and software from several countries in the world for its new business.
It encourages us to analyse in detail the new positions on the taxation of new technologies around the world, as well as the treaties and agreements signed by Brazil and the countries involved so that we can design the operation in the best way possible for the client.
Another very interesting case involves a Brazilian group with more than 90 years of experience in the transport, logistics and mobility market, which is designing a new business separate from the group together with another major Brazilian player. This joint venture, when formed, will become the fifth largest company in the auto parts industry in Brazil.
The difficulty lies in designing the best corporate and tax structure for both groups while they can
still reach their end customer with competitive prices, despite the tax discrepancy and cascading incidence of taxes when negotiating between Brazilian states.
What is the most exciting aspect of your role and what is the most stressful?
The most exciting aspect is dealing with innovative issues, such as businesses that do not exist in Brazil or new technologies that have never been studied, which makes the studies and structuring of these businesses intriguing, considering the chaotic Brazilian tax system.
The most stressful part is dealing with cases involving millions and billions of reais that can decide the future of the business and thousands of jobs in a Brazilian legal system with so much uncertainty, which makes it difficult for clients to understand, especially foreigners.
Tell us the key characteristics that make a successful tax professional.
The tax professional must be ethical, hardworking and dedicated to tax and accounting studies but without forgetting international knowledge and a profound understanding of his or her client’s business.
As an example, in one of the major tax litigation cases I worked on, the defence’s best argument to prove the legality of the company’s corporate reorganisation in Brazil was found by me in an article written by an engineer and published in a renowned magazine in the USA. The article concluded that all large business groups in this specific sector were reorganising themselves worldwide in this way due to new technologies.
What is the most common misconception about your work?
The biggest misconception about my work is the confusion with accountants. The tax professional needs to be extremely technical and attentive to accounting precepts, as does the accountant to tax legal precepts, but the two careers are complementary and not exclusive, which sometimes confuses clients.
What or who inspires you?
I am inspired by ethical and extremely technical leaders who are ahead of their time.
In general, but particularly for those who were born and live in a third world country, the economist and professor Amartya Sen is an inspiration. He won the 1988 Nobel Prize in Economics, and was one of the creators of the Human Development Index. His book Development as Freedom and all its positioning and studies on social justice and John Rawls’ theory of justice is a great inspiration.
In law, I’d say professor and judge Richard Allen Posner. He is one of the main exponents of law and economics, who brought to the world important reflections and debates through books such as Economic Analysis of Law and How Judges Think. Posner is also an expert on moral theory, pragmatism and democracy. He has been a great inspiration since college.
If you weren’t a tax professional, what would you be doing?
My passion for law and economics from a young age led me to tax law, I am extremely happy and I don’t see myself doing anything else in life. My studies, judgments and positions related to tax law transforms people’s lives, which is a magnificent experience.
Any advice you would give your younger self?
Remain firm in your values and principles, keep your anxiety under control and be sure to be prepared, because when luck passes you by, you will be ready for the great challenges that lie ahead in your career.
Tell us what makes tax cool!
Dealing with great leaders from all spheres, such as politicians, businesspeople, ministers and government professionals from all over the world, and learning daily about business and the global economy makes tax law unique and thought-provoking.
Originally published in International Tax Review