The AGU (Advocacy General of the Union), at the request of the Presidency of the Republic, sued the STF (Supreme Federal Court) against suspension of the agreement of Confaz (National Council of Finance Policy) that defined the ICMS policy of the states on diesel. The government’s maneuver was anticipated by CNN analyst Caio Junqueira on the 5th of this month.
In practice, the AGU claimed that the Confaz agreement adopts “an unorthodox ‘equalization factor’ of the tax burden for each state”, to “adapt the collection of ICMS from the States and DF to the new single-phase taxation model”.
“The present direct action is intended to challenge clauses four and five, as well as the respective Annex II, of ICMS Agreement No. Tax on Operations Related to the Circulation of Goods’ and on ‘Provisions of Interstate and Intermunicipal Transport and Communication Services’ [ICMS] on diesel oil and defines the applicable rates”, says the direct action of unconstitutionality that the AGU filed with the STF.
On March 24, the State Finance Secretaries approved the “ICMS Agreement”, which regulates the collection of the tax for diesel oil. The proposal creates a rate with a standard fixed cost per liter and extends the freeze on the state tax on gasoline, ethanol and cooking gas for another 90 days. Thus, the measure remains in force until June 30th, and the new rules take effect on the following day: July 1st.
The decision was taken at an extraordinary meeting of Confaz. Under the agreement, the state rate for the liter of S10 diesel oil, the most widespread in the country at the moment, was set at a ceiling of R$ 1.0060, calculated using the reference value of November last year.
According to the AGU, the strong asymmetry of ICMS rates “gives rise to problems that go far beyond the integrity of Brazilian fiscal federalism”.
“Mainly burdening the final consumer, who ends up penalized with the high cost generated by excessive rates for fuels – which are essential inputs, and therefore should be treated with modesty – and with the difficulty in understanding the composition of the final price of these products ”, said the AGU.
(Posted by Carolina Farias)
Source: CNN Brasil
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