Amidst the pressure of high fuel prices and to electoral calendarthe federal government is advancing measures to try to contain the impact of fuel prices resulting from the war in the Middle East, now including gasoline, and reduce negative effects on the purchasing power of Brazilian families.
The most recent initiative provides for the possibility of alleviate costs of fuels at times of strong rise in oil prices on the international market.
The government treats the measure as preventive and assesses that the country should not fully absorb the effects of the war. The rise in fuel prices is one of the main Luiz Inácio Lula da Silva (PT), alongside the increase in household debt, which remains at high levels.
The movement occurs in a broader context of concern about inflation and the cost of living, sensitive topics in election years. The rise in fuel prices is seen as one of the main pressure factors, both due to the direct impact on the consumer’s pocket and the indirect effects on the entire price chain.
This Thursday (23), the economic team announced an oil project to reduce fuel prices for the duration of the conflict. The text has already been filed in the Chamber under the authorship of the government leader in the House, deputy Paulo Pimenta (PT-RS).
In practice, the proposal authorizes a partial reduction in the tax rate, such as the Cide and the PIS/Cofinson gasoline, diesel, ethanol and biodiesel when an extraordinary increase in revenue is observed resulting from the rise in oil prices. The reductions would be equivalent to the additional amount collected and could be implemented by presidential decree.
The partial drop in taxes, therefore, will not be immediate. There is also no exact definition of how much each tax would be reduced or the final impact on consumer prices.
The economic team states that the proposal maintains fiscal neutrality, without compromising the target of a surplus 0,25% do PIB. The Minister of Finance, Dario Duriganargues that the measure follows fiscal responsibility and, at the same time, can help to cushion the effects of war on the population.
According to , this is a temporary measure and is continuously monitored by the economic team, with a commitment to preserving fiscal balance. Initially, the government is working with a deadline of around two months, although the duration of the international conflict is still uncertain.
The proposal adds to other initiatives already announced, such as subsidies for diesel oil, cooking gas and aviation kerosene, as well as credit lines for Brazilian airlines.
The new minister of the Secretariat of Institutional Relations, José Guimarãesstated that the leadership of Congress is aligned with the proposal, and the government must act to approve an urgency regime for the text in order to speed up its processing.
Last week, Guimarães even defended the idea of “saving” what he called the popular economy, in a position that differs from the line adopted by the economic team.
At the same time, the economic team has already sent President Lula the final order for a new stage of the debt renegotiation program. The announcement is expected to be made by next week.
