Diesel tax recovery returns on January 1st, says Haddad

As part of the package of economic measures that will be announced this week, the Minister of Finance, Fernando Haddad, announced this Tuesday (26) that diesel will be re-encumbered from January 1, 2024. However, he highlighted that there is no reason for there to be an increase in prices. The announcement was made after a meeting with vice-president Geraldo Alckmin.

According to Haddad, there could even be a reduction, since Petrobras announced a cut in fuel prices starting on Wednesday (27). “This reencumbrance will be carried out, but the impact of the reencumbrance is just over R$0.30 and the impact of the price reduction already announced by Petrobras in December is more than 50%”, he explained after the meeting.

“From the 1st of January, if you compare the price of diesel with the 1st of December 2023, you will see a drop in the Petrobras price even with the re-encumbrance. There is no reason for it to increase, there is a reason for it to decrease,” said Haddad .

The minister also informed that the price charged by Petrobras on January 1st, with the re-encumbrance, is less than what the company charged on December 1st, 2023 without taxes. “Petrobras today announced the second cut in December, which more than compensates for the January 1st re-encumbrance. There is no reason for it to have an impact,” he declared.

After the meeting with Alckmin, Haddad avoided giving many details about other economic measures, but assured that by Thursday (28), the government will present an alternative for payroll relief. He said that the set of compensatory measures should be sent to Congress in 2023 and that he awaits the approval of the Civil House for the proposals.

“In relation to the MP [medida provisória] which should be published this year and the laws that will be forwarded to the National Congress, I dispatched with Bruno Moretti — since the president [Lula] is in office, is in national territory and signing. I had already discussed with President Lula last week and this week we agreed with Bruno Moretti from SAG [Secretaria Especial de Análise Governamental] the final details. So probably between tomorrow and Thursday the acts will go to the National Congress”, said Haddad.

When asked about possible action in the Federal Supreme Court (STF), due to the thesis of unconstitutionality of the measure, the minister said that what will be forwarded “corrects this defect”.

“We will not have difficulty and we will have time to negotiate with the National Congress, opening, as we did with all the measures throughout the year, the data, have occasional monitoring by the TCU, check the data from the Federal Revenue, demonstrate the impact what it will have for the economy, on employment, do everything well so that there is no doubt”, he guaranteed.