Lula had a golden week – 7/8/2023 – Celso Rocha de Barros

The Chamber of Deputies approved the Tax Reform proposed by the Lula government.

It was the first major tax reform approved since the end of the dictatorship. Brazil will have a tax system more similar to that of developed countries. Distortions that have crippled our industry over the last few decades will be eliminated. The broad front that elected Lula showed that it can deliver more than the reconstruction of democracy: the reform was the result of different people talking about progress.

Economist Samuel Pessôa had already written in this Sheet that it can be a new Plano Real. I don’t know if it will be, but economists’ projections are really good. In addition, after the last decade, half a Real Plan would be enough to make me do an Olympic tour of the Três Poderes square.

It was a great victory for the government, but not just for him.

There is no doubt that the mayor, Arthur Lira, played an important role in approving the reform. Deserves congratulations. He entered the field for reform, mobilized his class, put them to vote, fulfilled his role.

But it’s good to remember that Arthur Lira was even more powerful until last year. Deputy Baleia Rossi (MDB-SP) had already presented, in 2019, a proposal for a constitutional amendment with content very similar to the reform approved now. But the reform did not work, because the Bolsonaro government did not bank.

PEC 45 was inspired by the work of economist Bernard Appy, one of the few members of Palocci’s economic team who had been close to the PT in the 1990s. Appy left the Lula government in 2009, shortly before the PT’s economic policy took a turn for the worse . He came to be seen as part of the community of more “orthodox” economists. This did not prevent him from declaring his vote for Fernando Haddad in the 2018 second round.

When Lula was elected president, the institutional dialogue returned and Appy was appointed extraordinary secretary for Tax Reform. With Alckmin, Haddad and Tebet, Lula chose a deputy, a finance minister and a planning minister who were enthusiastic about reform.

Fernando Haddad, by the way, ends the semester with the fiscal framework and the tax reform well advanced. In January, they called it the “optimistic scenario.” Haddad continues to function.

The governor of São Paulo, Tarcísio Freitas, also came out of the episode well. Elected by Bolsonarism, he disobeyed Jair and supported the reform. Bolsonaro decided to show who’s in charge, he did, it wasn’t him.

Tarcísio was booed by Bolsonaristas and won praise from the center. He will need to re-accommodate difficult tensions within his base. But he passed the test of responsibility, which someone from Jair’s orbit had never approved.

I again notice the difference in climate after the change of president: the Lula government has better relations with Tarcísio, who was elected as an opponent, than Bolsonaro had with Doria, who was elected as an ally.

Someone might say: but what Lula did was the obvious. The proposal was there, it was just a matter of appointing the father of the reform as secretary, finding a good finance minister, negotiating with Lira and with opposition governors. To me, it already seems like a lot. And remember: last year, the obvious beat the absurd by less than 2 percentage points.

PRESENT LINK: Did you like this text? Subscriber can release five free hits of any link per day. Just click the blue F below.