Debate between states and Union on losses in ICMS collection is set for 2023

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States and the federal government were unable to reach an agreement on compensation for revenue losses caused by changes in the ICMS tax on fuel. After a series of meetings, Minister Gilmar Mendes, of the Federal Supreme Court (STF), ended this Friday (2) the work of the commission created to try to reconcile interests on the subject. Mendes is the rapporteur for actions in the Supreme Court on the limitations of the tax.

Unable to negotiate the losses, finance secretaries decided to create a new working group to discuss the matter in 120 days. The negotiating table, however, ended with a consensus. Governors should establish a uniform and single-phase tax for fuels. Gasoline was left out of the rules.

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Hours before the meeting, Minister André Mendonça, of the STF, extended for another 30 days the deadline for governors to implement the new rules on the tax. Mendonça determined the change in the rate in June, but has extended the deadline at the request of the states.

Governors claim losses after the definition of a ceiling of 17% for the collection of state tax on services considered essential. The change in legislation was approved by the National Congress, amid rising fuel prices in the country.

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The new rule provides for a trigger for losses greater than 5% of the 2021 collection. The counterpart, however, is criticized by the states.

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During the hearings at the STF, Finance Secretaries pointed out losses of more than R$ 40 billion after the changes. The new rules prompted lawsuits, filed by at least eight states, with claims for compensation.

Members of the transition team even participated in the latest discussions on the subject. But, according to reports heard by the report, they did not express themselves concretely about the problem that will be inherited by Lula. Members of the group even suggested including compensation to the States in the Transition PEC, but found no room for debate.

The expectation is for the issue to be addressed at a meeting between Lula and elected governors. The meeting, organized by the governor of the Federal District, Ibaneis Rocha (MDB), should take place on December 7th, in Brasília.

Source: CNN Brasil

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