Governors will charge Lula compensation for ICMS losses

The governors of the 26 states and the Federal District will have a new meeting with President Luiz Inácio Lula da Silva (PT) on Friday (27), at the Planalto Palace. The Forum of Governors met this Thursday (26) at a hotel in the federal capital to define the demands that will lead to the government. The main subject should be the loss of collection with the reduction of the rates of the Tax on Circulation of Goods and Services (ICMS), a state tax on fuel and other essential services.

“We are highlighting an urgent issue, which concerns the recomposition of state revenue, as a result of the brutal loss, originated from the change in legislation, enshrined in Complementary Law 192 and Complementary Law 194. Legislation that was approved last year, without no debate with the states and which has caused and is causing a brutal drop in the revenue of our states”, said the governor of Rio Grande do Norte, Fátima Bezerra, at the end of the meeting.

Complementary Law 194 determines the application of ICMS rates at the floor (17% or 18%) for essential products and services when levied on goods and services related to fuel, natural gas, electricity, communications and public transport. Complementary Law 192, on the other hand, unified the form of calculation of ICMS, specifically on fuels, which became per unit of measurement, instead of a percentage of the average price of the product sold at service stations.

According to the governor of Espírito Santo, Renato Casagrande, in 2022 alone, after the legislation came into force, the loss of revenue in state coffers exceeded R$ 33 billion. He stated that the Forum of Governors will ask the federal government to regulate a device of Complementary Law 194 that establishes compensation, by the Union, when the loss of revenue of a state exceeds 5% in relation to the collection of 2021.

“The path is to regulate the law, which says that if revenue loss exceeds 5%, the Union has to compensate the states. There was no revenue recomposition last year, and there must be recomposition”, he said. At Lula’s request, the governors should also present a list of priority works and actions in each state and region during the meeting. Interstate consortia will also present their demands. With information from Agência Brasil.