ICMS: gasoline price should rise in 22 states and in the DF – 05/30/2023 – Market

After two weeks of decline, the price of gasoline came under pressure again in early June with the change in the ICMS collection model, which now has a single rate in reais per liter in all states.

The new rate of R$ 1.22 per liter is R$ 0.20 higher than the average currently charged, according to accounts by consultant Dietmar Schupp, specializing in fuel taxation. Consumers, however, will experience different effects depending on the state.

This happens because some states used a higher rate than R$ 1.22 per liter and, therefore, should see a drop in the price of fuel. According to Schupp, Amazon, Piauí and Alagoas fall into this case. In Roraima, there is no variation.

In the rest of the country, the pressure will be for readjustments. The state with the highest expectation of high is Mato Grosso do Sul (R$ 0.30 per liter), which would represent an increase of 6% over the average price at local gas stations, of R$ 4.94 per liter.

In another ten states, the expected increase is higher than the national average, between R$ 0.25 and R$ 0.29 per liter. In São Paulo, the new rate is R$ 0.26 per liter higher than the one currently charged. In Rio de Janeiro, the difference is R$ 0.11 per liter.

The new ICMS collection model was approved by Congress in March 2022, with the support of former President Jair Bolsonaro (PL) and the fuel sector, who saw room for fraud in the previous model, in which each state practiced its own rate .

In addition to establishing a single value throughout the country, the tax is now charged only on producers and importers, and no longer on the entire chain, including distributors and resellers.

In the cases of diesel and cooking gas, the change was implemented in May. The price of cylinders was also pressured by the new ICMS, whose average rate, in this case, is R$ 7.50 higher than that previously charged.

The change in ICMS should interrupt the recent cycle of low gasoline prices, a reflection of cuts promoted by Petrobras in its refineries, and celebrated by the government as an additional factor of pressure for the reduction in interest rates.

Since the cut in refineries, announced on May 16, the average price of fuel has fallen by 4.2%, or R$ 0.23 per liter, according to the ANP (National Agency of Petroleum, Gas and Biofuels). The accumulated drop is slightly lower than that forecast by Petrobras, of R$ 0.26 per liter.

The effects of the new ICMS, however, should not be captured in this week’s weekly price survey by the ANP, as data collection usually takes place in the first few days.

In addition to state taxes, the price of gasoline will be pressured again in early July, when the federal government is expected to return to full PIS/Cofins rates, which had been zeroed by Bolsonaro and partially resumed by Lula in March.

Finance Minister Fernando Haddad went so far as to say that Petrobras had withheld part of the cut to compensate for the tax increase, but he backtracked after the state company refused. The market, however, expects the company to contribute to offsetting the rise.

Currently, the space is small: according to Abicom (Brazilian Association of Fuel Importers), gasoline sold at Petrobras refineries was R$ 0.34 per liter below the import parity at the opening of the market this Monday ( 29).

In its new pricing policy, Petrobras abandoned this concept, which simulates fuel import costs, but the high lag indicates that the state-owned company has been practicing lower margins on the sale of the product.