Haddad: Oil companies make exorbitant profits – 03/01/2023 – Market

The Minister of Finance, Fernando Haddad (PT), said this Wednesday (1st) that the decision of the Luiz Inácio Lula da Silva (PT) government to institute a 9.2% tax on crude oil exports is a ” transition solution” and classified the profits of companies in the sector as “exorbitant”.

The charge was announced by Haddad and by the Minister of Mines and Energy, Alexandre Silveira (PSD), on Tuesday (28) as a way to compensate for the loss of revenue with the partial reencumbrance of federal taxes on gasoline and ethanol.

“[O Imposto de Exportação] it is a transitional solution. Companies are making extraordinary profits because of rising oil prices. Exorbitant profits. They pay few taxes, in my opinion”, said Haddad in an interview with the UOL portal.

“It is an intermediate solution for us to phase out the reenactment, and Congress will have the final say,” he added.

As of this Wednesday, the PIS/Cofins rate rises to R$ 0.47 per liter of gasoline and R$ 0.02 per liter of ethanol. The Cide (Contribution for Intervention in the Economic Domain) remains zero.

In July, if there are no changes in Congress, full charges of R$ 0.69 per liter of gasoline and R$ 0.24 on ethanol will be resumed.

With the institution of the tax on the export of crude oil, the government expects to collect R$ 6.66 billion. The measure lasts for four months.

The export tax is a regulatory tax – used by the government to encourage or discourage a certain activity. Due to this feature, the tax rate can be changed at any time, without the need to give notice of 90 days or one year.

To UOL, the minister also minimized the negative reaction of companies in the oil sector after the announcement of the measure. “Everything makes noise, even a poorly placed word makes noise, but I think it accommodates. We explain, and things become more transparent. People understand the purpose”, he said.

In a note, the IBP (Brazilian Institute of Petroleum and Gas), the main representative of the sector in the country, said that it sees “with great concern” the institution of the export tax on petroleum.

“Oil exports are the third most important item in the Brazilian trade balance, being responsible for a surplus of US$ 65 billion in the last four years. Thus, the taxation of foreign sales, even temporarily, can impact the competitiveness of the country. country in the medium and long term, in addition to affecting the national credibility with regard to the stability of the rules”, said the entity.

On Tuesday night, Haddad met with allied leaders in Congress and the minister of the Institutional Relations Secretariat, Alexandre Padilha (PT), to detail the measures.

On leaving the meeting, Padilha defended the combination of actions as a “responsible way” to minimize the impact of the resumption of taxes on consumers.

“The temporary tax with taxation on those who export crude oil, that is, that export that is made without generating processing, development, without generating jobs, technological investment in our country, we are making this taxation to take this resource and reduce the impact of the increase in gasoline prices, in order to maintain the exemption of diesel oil and gas”, said the minister.