Brazil economy minister vows to unveil solid measures
Brazilian Economy Minister Paulo Guedes announced the government is putting together a series of “extraordinarily strong and positive” measures for the country.
“There are excellent things being prepared, including cheap energy, the [so-called] federate pact, the reduction and simplification of taxes, and privatization,” he told Globonews on Wednesday evening (Apr. 17).
The minister added, however, that these measures could only be implemented if public accounts are organized, following the approval of the overhaul in the country’s pension system.
Guedes said the government has adopted a strategy for the approval of the pension reform. “I can’t say how we’re giving in. We have a negotiation strategy. We are ready to cave in to certain things, but not others,” he said.
Tax reform
Guedes also reported that Federal Revenue Secretary Marcos Cintra has been considering unifying taxes—like the Social Contribution on Net Profit (CSLL), the Tax on Manufactured Goods (IPI), the Social Integration Program (PIS), and the Contribution for Social Security (Cofins)—into a single federal tax.
The federal tax, he went on to say, will be different from the old Provisional Contribution on Financial Transactions (CPMF). “Yes, we’re merging [taxes] together. We’re studying the basis. This is the IVA [Tax on Aggregate Value, aimed at unifying consumer taxes]. This is what we’re studying here, the federal IVA,” he said.
Petrobras
Paulo Guedes said President Jair Bolsonaro has backed him in his efforts to take care of the Brazilian economy. “For now, I can’t complain. I haven’t been impeded in my autonomy,” he declared.
The president, Guedes said, did not ask Petrobras CEO Roberto Castello Branco to go back on the decision to raise the price of diesel last Friday (12), but rather to ask for clarifications. “At no moment did he tell him to suspend the rise. The president of Petrobras took some time to explain it to the president. Now the game goes on,” he said.
Nonetheless, Guedes said the situation did not take place in the best possible way. “It is natural that he acts hastily as a president. Did it happen the best way? Of course it didn’t,” he said. In Guedes’s view, the president was concerned about the political magnitude of the price hike.
On Tuesday (16), after a meeting with the president, Guedes and Mines and Energy Minister Bento Albuquerque said the government is committed to not manipulating pricing and increasing transparency at Petrobras.
Yesterday (17), the oil giant unveiled a R$ 0.10 hike in the price of a liter of diesel at refineries, bringing the price of the fuel from an average of R$ 2.14 to R$ 2.24 at the 35 distribution spots across the country.
Concerns focused on the demands made by truck drivers, the minister claimed. Truck drivers staged a nationwide strike that brought the country to a halt. Diesel pricing, he added, is not the main protest of truck drivers, but rather the issue of road safety, linked to paving and an appropriate, violence-free place for resting. Of the 13 demands from the freight transport workers, he said, diesel price ranks 12th.
