From the truckers' strike of 2018, a series of discussions about changes in the regulatory model of the fuel sector gained momentum. Among the initiatives that have advanced, we can mention the pricing of fuels by Petrobras, price transparency and the direct sale of ethanol.
With the rise in fuel prices in a scenario of declining popularity, in 2021 the Bolsonaro government gave impetus to a new series of measures related to the fuel sector, again in the context of pressure by the truck driver movement. Among other measures, PLP 16/2021 stands out, which proposes a change in the ICMS taxation on fuels, and MPV 1034/2021, which together with Decree 10.638 / 2021, reduced the PIS / CONFINS rates on diesel and LPG . Decree 10.634 / 2021 was also issued, which deals with transparency in fuel prices.
The current discussion on fuel taxation in Brazil, embodied in MPV 1034 and PLP 16/2021, runs through the debate on the creation of a Stabilization Fund for fuel prices and a social program for LPG focusing on fuel families. low income. In a transversal way, the discussions still permeate the debate on the broad tax reform under discussion in the Legislative Branch.
PLP 16/2021 was sent by the Executive Branch to the National Congress on 4/17/2021 with constitutional urgency, that is, the legislative houses had 45 days to vote on the matter, under penalty of locking the agenda of the Plenary after this period. On 03/30/2021, the Executive Branch removed the urgency of the project, which would lock the agenda of the Plenary from 03/31/2021, in view of the pressure from the governors.
In this way, PLP 16/2021 went through the commissions to which it received an order, namely: Finance and Taxation Commission - CFT (merit and termination opinion) and Constitution, Justice and Citizenship Commission - CCJC (termination opinion), and then it must be considered by the Plenary. Currently in the CFT, the project has Deputy Julio César (PSD / PI) as rapporteur.
PLP 16/2021 has been the subject of joint discussions between the Ministries of Mines and Energy (MME) and Economy (ME). Faced with the scenario of new pressure on diesel prices, President Bolsonaro said in a recent speech that the government is willing to negotiate project items, such as the single ICMS rate. Previously, the President also stated that he would like Dep. Luis Miranda (DEM / DF) reporting on the project. The Deputy has sought to take a leading role in discussions on fuel taxation, presenting a request for the creation of a subcommittee on tax reform within the scope of the CFT and also proposing public hearings.
Despite the fact that the government is focusing efforts to overcome the high fuel prices through MPV 1034/2021 and PLP 16/2021, the Mayor, Arthur Lira, has not given the same priority to the issue. Note that, to date, MPV 1034/2021 is awaiting appointment as rapporteur. During the regulatory period, the measure received about 80 amendments, covering proposals such as:
Reduction of restrictions on the purchase of motor vehicles by people with disabilities;
Replacement of the PIS / Cofins exemption for agricultural chemicals by the exemption of products that promote biological pest control;
Abolition of the repeal of the special tax on naphtha and other products destined for petrochemical plants (REIQ);
Transition period, through the progressive reduction of the REIQ until the total extinction;
Increase in the CSLL rate only for the financial sector;
Withdrawal of credit unions and insurance operators from the list of legal entities affected by the increase in the proposed CSLL;
Inclusion of Withholding Income Tax (IRRF) of 15% on Profits and Dividends; and
Inclusion of items in the list of hospital products to deduct presumed credit from PIS / Pasep and Cofins.
MPV 1034/2021 locks the Plenary agenda from 04/15/2021 and loses validity from 06/28/2021, and the suspension of the collection of PIS / Cofins levied on diesel runs until 04/30/20. In a scenario of maintenance of pressure on fuel prices, the government may initiate a movement to negotiate alternatives with the National Congress to advance MPV 1034, aiming to mitigate political wear and tear, as well as reinforce the narrative of transferring responsibility to the legislature and governors. Among the factors that have been pressing diesel prices are the exchange rate, international prices and the increase in the cost of biodiesel. It is also worth mentioning the repercussion of the 39% readjustment announcement in natural gas contracts by Petrobras.
Debates in the National Congress
Following the wide public debate on the fuel sector, several bills were presented and open fronts for discussion in the Legislative Branch, especially through public hearings in the various commissions.
Against the background of the discussion on fuel prices, initiatives and debates related to the regulation and functioning of the fuel sector chain arise, with emphasis on Petrobras' performance and divestments. Among the themes, the following stand out: the possibility of direct sales between refineries or plants and resellers, end of the tutelage to the flag at dealer stations, anti-fraud devices at fuel pumps, fractional sale of LPG and end of the brand on cylinders, transparency and disclosure of the composition of fuel prices, as well as the formation of cartels, expansion of competition, open access to essential facilities and reduction of barriers to entry in the various links in the fuel sector chain. On the part of the Executive Branch, MME, ANP, Senacon, CADE and ME are invited to participate in the debate.
Last updated: 4/8/2021
By Leobino Araújo, Partner and Government Relations Manager at Umbelino Lôbo