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Even with reduced ICMS, fuel price still weighs on drivers’ pockets

July 2, 2022
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Even with reduced ICMS, fuel price still weighs on drivers' pockets
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Nilton Cavalcanti, 54, an app driver for more than two years, decided to enter the business at a time when individual passenger transport companies were arriving in Curitiba. The activity seemed promising to supplement income, due to the freedom and flexibility of schedule.

However, with the worsening of the economic crisis, what was supposed to be an option ended up becoming one of the few guarantees of income. And now, with lower yields due to the high price of gasoline.

“I got to make good money with the application in other times. Today, with the price of gasoline and inflation, it’s getting difficult”, he analyzes. With the value of gasoline above 7 reais, due to the dollarization of prices promoted by Petrobras, the reality of the driver is similar to that of millions of Brazilians.

Trying to avoid further increases in an election year, but without displeasing the “market”, the Bolsonaro government has been seeking to promote an economic agenda of withdrawal of federal taxes and pressuring state governors to zero the rate of the Circulation Tax on Goods and Services ( ICMS) on the final value of the fuel.

With the federal government cut on national taxes, gas stations have been reducing the values ​​at the pump, with an average variation from R$ 7.60 a liter to R$ 6.83 in some stations in the capital of Paraná.

Cavalcanti sees temporary relief from the reduction, but is still pessimistic about the long term. “Of course it helps, but since everything is so expensive, the effect ends up being smaller than it could be,” he says.

Rosi Milani, 57, also an app driver, cites that the price drop was a relief, but points out that it is still far from ideal. “This price of fuel helped, I managed to do 260 kilometers with 100 reais, whereas before I did 180 kilometers with 100 reais. But the ideal was to do 300 kilometers, because our expenses are not limited to fuel”, he reports.

short term measure

For the economist of the Inter-union Department of Statistics and Socioeconomic Studies (Dieese-PR), Sandro Silva, the measure can be beneficial in the short term. But without Petrobras changing its pricing policy, nationalizing costs, the effects for the future could be worse.

“These measures do not solve the main problem, which links the price of the domestic market to the international one. This reduction of federal taxes and the limitation of ICMS end up not solving it, because the country continues to be at the mercy of the international scenario. ideal was for the government to abandon the current pricing policy”, he analyzes.

For Silva, the logic of the Bolsonaro government is to privatize the energy sector, with the delivery of refineries. On the tax issue, the economist warns that the debate should be deeper.

“Removing ICMS from fuel has significant representation for states in the financing of health and education, for example. It is clear that the tax burden is high, but it is not from a stroke without planning that will solve it. tax burden, reducing consumption and increasing income, ending this regressive system, in a broader discussion'”, he points out.

17 billion

In Paraná, the Legislative Assembly (Alep) canceled the July recess, transferred to September, for the House to vote on the Budget Guidelines Law of 2023 and the ICMS cut on fuel prices.

For state deputy Requião Filho (PT), the measure could mean a loss of resources. “Paraná secretly grants R$ 17 billion in tax waivers and, now, in view of the new Federal Law that deals with ICMS on fuel, the State will lose more than 6 billion in its budget”, he says.

Currently, the ICMS rate on gasoline is 29%. According to Governor Ratinho Junior (PSD), the state tends to follow the Bolsonaro government.

“We are going to follow the federal law. The prosecutor, together with the Secretary of Finance, is now carrying out the entire legal study, because possibly we will have to present a law in the Legislative Assembly authorizing compliance with the federal law, but this has already been appeased. “, he said at a press conference.

electoral bomb

The drop in federal taxes on fuel and the reduction in ICMS are true electoral bombs. In the case of ICMS, in addition to the current drop, Bolsonaro defends that the collection of the tax be suspended until the end of the year exclusively on fuel and gas, from July 1 to December 31 – the final period of his term.

The proposal, which would cost around R$30 billion, has already been classified as “mambembe”, improvised and desperate by economists and members of popular movements.

Source: BdF Paraná

Editing: Frédi Vasconcelos and Lia Bianchini

Tags: driverseverything expensivefuelgasolinegeneralicmsinflationpocketspricereducedweighs

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