The Senate concluded on Tuesday, 2, the vote on the Proposal of Amendment to the Constitution (PEC) 66/2023, which takes the payment of federal government precatory from the tax framework spending, in ten years the return of values to the fiscal target and helps the cash of states and municipalities, limiting the payment of state and municipal precatories and reparcelling the debt of the municipalities.
There were 71 votes in favor and two contrary to the second round vote. The PEC had already been approved in the first round, but one last vote was missing. The promulgation session should be held next Tuesday, 9. In addition to the change in precatory, the government was able to include a stretch to allow the opening of a tax space of R $ 12 billion permanently in the budget from 2026, election year.
The PEC is a claim of the National Front of Mayors (FNP) and the National Confederation of Municipalities (CNM), on the grounds of allowing municipalities to comply with tax obligations without affecting the financing of public services.
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By the text, municipalities will be able to install their debts with the Union, including those contracted by their municipalities and foundations, in up to 360 monthly installments, while currently 60 months. Exceptionally, social security debts can be paid in 300 times instead of the 240 current installments.
PEC also limits the payment of states from states and municipalities. Precatory are payments that regional governments must make after definitive judicial conviction. The subject involves lawsuits related to salaries, pensions and indemnities, for example.
Payment of precatory is provided for in the Federal Constitution. With discharge in the judicialization, the disbursement of R $ 62.78 billion in precatory made the public deficit jump in July. As Estadão has shown, the measure should increase the stock of judicial debts by 357% over a period of ten years. In some cases, such as Alagoas, debts should grow up to 1,000% in the period.
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BTG Pactual provides for an exponential increase in the inventory of late subnational entities with PEC 66. In ten years, the bank’s simulations point to quadruple, from R $ 193 billion, figure from 2024, to R $ 883 billion at the end of 2035.
Here are the main points of the text that will be promulgated:
Debt reparcelling
Municipalities will be able to install their debts with the Union, including those contracted by their municipalities and foundations, in up to 360 monthly installments, while currently 60 months. Exceptionally, social security debts can be paid in 300 times instead of the 240 current installments.
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New Limits for Precatory
Precatory payments by the states, municipalities and the district will have new limits: 1% of net current revenue (RCL) for municipalities with stock of precatory in arrears up to 15%; 1.5% of RCL for inventories between 15% and 25%; 2% of RCL for inventory between 25% and 35%; 2.5% of RCL for inventory between 35% and 45%; 3% of RCL between 45% and 55%; 3.5% of RCL for inventory between 55% and 65%; 4% of RCL for inventory between 65% and 75%; 4.5% of RCL for inventory between 75% and 85%; and 5% for inventory greater than 85%.
Propag for municipalities
The text applies to the municipalities all provisions on the installment of state debt debts of the State Debt Payment Program (Propag).
New calculation base for monetary and interest update
The project establishes the National Consumer Price Index (IPCA) as a parameter for the calculation of the monetary restatement and interest for Precatory to the precatory and social security debts of the states, municipalities and the Federal District.
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The text provides that, from the financial year 2026, be excluded from the tax framework limit the union expenses with precatory and small value requests (RPVs). On the other hand, the spending ceiling will be reduced in the same proportion, that is, there will be no increase in “inside” fiscal space, but payment with precatories could grow “on the outside” without squeezing other expenses.
From 2027, the annual union expenses with precatory will be incorporated “gradually” in the determination of the target of primary result established in the Budgetary Guidelines Law (LDO), cumulatively to each year, at least 10% of the expected amount of these expenses, which would total ten years the total incorporation. By the current rule, the precatory would have to return fully to the ceiling of the framework and the goal in 2027.
Project opens tax space of R $ 12 billion in the framework
The government overturned an opposition amendment and was able to ensure the opening of a $ 12 billion fiscal space in the budget permanently from 2026. By current rules, this value could only be used by 2025. The government gathered exactly the 49 votes necessary to maintain the text.
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The permission was articulated by the Minister of Planning, Simone Tebet. According to her, the money will be used to play the maternity salary to autonomous workers, determined by the Federal Supreme Court. PEC, however, moves the tax framework ceiling, without specific destination, and ends up increasing the total space for expenses.
“Let’s take advantage of this PEC to solve the problem of a meteor that has fallen into our head, which I do not discuss the merit, but that came out of nothing, which is to guarantee women maternity leave, so pays for the public system, even if it has no contribution.
