[FOSS-PDI] Brazilian government faces challenge over proprietary tax software

[Sunil Abraham]

http://trends.newsforge.com/article.pl?sid=06/10/24/2050209&from=rss

Brazilian government faces challenge over proprietary tax software
Friday October 27, 2006 (05:01 PM GMT)
By: Bruce Byfield

 The Free Software Foundation - Latin America (FSFLA) is campaigning 
against the Brazilian government's regulations that some citizens must 
use non-free software for paying taxes. Referring to the software as 
"Softwares Impostos," a term that puns in Portuguese on "taxes" and 
"imposed," FSFLA has launched a letter-writing campaign against the 
requirement, arguing that it is both contrary to current social policies 
and a violation of the Brazilian constitution.

Complaints about government services that are accessible only through 
proprietary software are increasingly common around the world. For 
instance, in the United States, the Federal Emergency Management 
Agency's Web site at one time would only accept disaster claims from 
survivors of Hurricane Katrina via Windows and Internet Explorer. 
Similarly, last spring's online census in Canada was accessible only 
through Windows or Mac OS X. What is unusual about the Brazilian 
situation is that it is unfolding against a background of increasing 
acceptance of free software, and that constitutional arguments may exist 
against it.

According to Alexandre Oliva, a Red Hat contractor and secretary for the 
FSFLA, the Brazilian government makes a number of taxation programs 
based on Windows and Sun Java 1.4 available for citizens. The most 
widely used of these programs is IRPF2006, which is developed by SERPRO 
S.A., Brazil's official federal data processing service and probably the 
largest provider of e-services in Brazil. Because hardcopy tax forms do 
not contain the necessary listings, many higher-income Brazilian 
taxpayers are required to use IRPF2006 for calculating and paying taxes. 
Those required to use the software include anybody with an income over 
R$100,000 ($47,000), or R$69840 (32,000) from a rural business, or with 
profits from sales of goods, rights, stocks, or futures, or a rural 
business.

IRPF2006 was originally Windows-only, but a Java version has been 
available since 2004. "The Java version was meant to be multi-platform," 
Oliva says, but "it happens to rely on internal classes that are not 
part of the Java specification, and that are only present in Sun's 
implementations and derived versions. Clean-room free software 
implementations shouldn't have to provide these classes: programs that 
directly refer to such internal implementation classes are not 
Java-compliant programs." Oliva adds that this dependency runs counter 
to the Receita Federal (Internal Revenue)'s own specifications, which 
require only Java 1.4 specifications, and not Sun's version of Java in 
particular.

A growing background of free software

In many countries, the fact that governments enforce the use of 
proprietary software remains a minor issue. However, Brazil is seeing a 
growing tendency for public policy to consider or even favor free 
software. "Few people are using only free software," says Omar Kaminski, 
a lawyer who represents Brazil in the GPLv3 process, "but it's a strong 
tendency in this government." According to Lucio Teles, a professor of 
education at the University of Brazil, free software is increasingly 
becoming the norm in Brazilian education. Similarly, Oliva notes that 
the number of businesses releasing free software is on the rise.

Moreover, many of Brazil's cities and 27 states have passed laws to 
encourage the adaptation of free software. The state of Paraná, for 
example, is currently developing a free license for all 
government-issued software. Such laws and policies are intended 
primarily to encourage the building of a computer infrastructure in a 
country that still has many pockets of extreme poverty. Admittedly, the 
constitutionality of such laws and policies is currently being 
questioned in the state of Rio Grande do Sul, but the momentum of free 
software appears to be only slowed, not checked, by such opposition. 
"The discussion is growing fast," Kaminski says.

According to Kaminski, the Conselho Nacional de Justiça (National 
Council of Justice) advocates that the federal judiciary use free 
software, and Ellen Gracie Northfleet, the president of the Supreme 
Court, is at least favorably inclined towards free software. In 
addition, Oliva says, Computadores para Todos (Computers for Everyone), 
the federal government program to enable those on low incomes to buy 
computers, has encouraged free software by offering tax breaks to 
manufacturers that sell their computers beneath a set price and makes 
low interest loans available to people who buy computers that are loaded 
only with free software.

Against this background, the insistence that Brazilians use proprietary 
software to interact with the government seems to run contrary to the 
prevailing tendencies in government policies.

Constitutional arguments

Perhaps even more importantly, Oliva says, strong constitutional 
arguments can be made against the Brazilian government's requirements. 
Although the legitimacy of many of these arguments depends on how the 
principles of free software are legally interpreted as interacting with 
copyright law and a marketplace economy, imposing the taxation software 
may be a straightforward violation of at least two articles of the 
Brazilian constitution.

Under Article 37, governments at all levels in Brazil are required to 
abide by several principles. These principles include "lawfulness," or 
the imposing of obligations upon citizens only by passing laws, and 
"impersonality," or impartiality towards individuals and corporations. 
Since no law has been passed that requires the use of the particular 
software, the Brazilian government may be violating the principle of 
lawfulness. Similarly, by requiring that only some citizens use the 
software and by using software manufactured by a particular company, the 
Brazilian government may also be violating the principle of 
impersonality. Oliva suggests that the argument can be taken even 
further because the additional costs required to upgrade or modify 
proprietary software also amount to partiality toward the software 
manufacturer -- to say nothing of being a hidden cost that the tender 
process does not take into account.

Similarly, Article 170 of the constitution lists a series of economic 
rights for Brazilians that any government actions must respect. These 
include free market competition, the defence of consumers, the reduction 
of regional and social inequalities, and favorable treatment for small 
businesses with headquarters in Brazil. The government's insistence that 
citizens use proprietary software, whose manufacturers are largely 
located outside Brazil, and whose price is prohibitive for many 
citizens, can be argued to violate all these principles.

Article 170 also states that "Free exercise of any economic activity is 
ensured to everyone, regardless of any government authorization, except 
in the cases set forth by law." Assuming that paying taxes is defined as 
an economic activity under Brazilian law, then the government's 
insistence on the software amounts to a violation of this assurance and 
is therefore illegal.

Unlike free software advocates in other countries, the FSFLA in Brazil 
does not have to base its opposition to pro-proprietary policies 
entirely on moral arguments -- although such arguments are hardly in 
short supply on the FSFLA Web site. Instead, in Brazil, the opposition 
is in the possibly unique position of having straightforward 
constitutional arguments from which to argue. The FSFLA continues to 
make these arguments, both about the taxation software and the pro-free 
software laws in Rio Grande do Sul, and they appear to be strong ones.

"I think it's a good and new way to interpret the federal constitution," 
Kaminski says. "As a new way to understand liberty, from the view of the 
Internet users, or free software users in this case, it's a great way to 
make the e-democracy to flow."

Whether the novel constitutional arguments will be upheld is still 
uncertain. For all the advances that free software has made in Brazil, 
proprietary software continues to have a firm foothold in government -- 
for example, Brazil's electronic ballots require Windows CE. As a 
result, the implications of the arguments are sweeping enough that they 
are unlikely to be accepted without careful scrutiny. However, should 
they fail, the FSFLA has one final argument. The software, Oliva notes, 
is unaccompanied by a license -- which is, in itself, illegal. "Per 
Brazilian law, using software requires a license or a proof of 
purchase," Oliva says. "Therefore, its use by any taxpayer is a 
copyright violation. When taxpayers are required to use such software to 
be able to comply with their tax obligations, the government is 
demanding citizens break the law.

"This is quite unfortunate," he adds with deceptive mildness.

Bruce Byfield is a course designer and instructor, and a computer 
journalist who writes regularly for NewsForge, Linux.com and IT 
Manager's Journal.