Lula says he doesn’t know why businesspeople are worried about the veto

President Luiz Inácio Lula da Silva (PT) questioned how much Brazilian workers in the 17 sectors of the economy benefiting from the payroll tax relief have actually gained since the measure was implemented 11 years ago, still during Dilma Rousseff’s government ( PT).

This was one of the points he took into consideration when vetoing the extension of the benefit until the end of 2027, which, he says, does not provide in law that benefiting companies are obliged to create new jobs, nor what they need to give in counterpart to have the tax reduction on labor charges.

Lula has been harshly criticized by the productive sector and the majority of congressmen for having completely vetoed the bill, which passed the Chamber of Deputies and the Senate with a large vote, and which should have the veto overturned by more than necessary.

“They [os setores] They are worried, I don’t know why. Because it would generate more jobs, it wasn’t, because there’s nothing in the law that said they would generate more jobs if there were exemptions”, he said this Wednesday (29) shortly before boarding from Riyadh, in Saudi Arabia, to Doha, in Qatar. Lula has a wide agenda of bilateral meetings in Middle Eastern countries, where he will also participate in COP28 in Dubai, in the United Arab Emirates, starting this (1st).

According to him, the government cannot make a tax reduction and companies cannot provide “compensation to workers”. “The workers need to gain something in this story. The company stops contributing on payroll and the worker gains what? There is nothing written that he will earn R$1 more in his salary”, he added.

Lula stated that congressmen have the right to overturn the veto on the bill, but that Finance Minister Fernando Haddad will present an alternative by the end of the year. Lula highlighted that he has been talking to business and workers union leaders since the beginning of the year, negotiating “a new relationship between capital and labor in Brazil”.

This “new relationship” includes, he says, “new union legislation”, and he classified as “ignorance” those who say that “unions need to be weakened”. “No, the stronger the union, the stronger democracy will be and the stronger the company will be,” Lula said.

The veto’s overturn is already taken for granted by both businesspeople and congressmen, who have joined together at least ten benches and two movements to reverse the president’s decision. During a press conference on Tuesday (28), the author of the project, senator Efraim Filho (União-PB), stated that he already has the necessary votes, and that there are even parliamentarians from the government base willing to vote in favor.

At the beginning of this week, the president of the Senate, Rodrigo Pacheco (PSD-MG), who is also president of Congress, stated that he could discuss the veto at the next meeting of the two houses this Thursday (30) or next week (7 ), depending on the negotiations of party leaders.

However, the expectation is that the analysis of this veto and others, such as the time frame and the fiscal framework, will be postponed until another week, as Pacheco is accompanying President Lula on his trip to the Middle East for bilateral meetings with governments from Saudi Arabia, Qatar and the United Arab Emirates – there he will also participate in COP28.