We cannot force stations to reduce prices, but the population can charge, says SP governor

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The governor of São Paulo Rodrigo Garcia (PSDB) told the CNN this Monday (4), that São Paulo cannot force gas stations to reduce prices, but the population can charge.

The declaration was made a week after the state reduced the value of ICMS (Tax on Circulation of Goods and Provision of Services) on fuel from 25% to 18%.

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In addition to São Paulo, at least 19 Brazilian states and the Federal District announced the reduction of ICMS, according to a survey carried out by the CNN.

The decisions follow a definition by the National Council for Finance Policy (Confaz), which follows a determination by the Minister of the Federal Supreme Court (STF), André Mendonça, that the tax rates be uniform across the country for fuel.

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“It is important for the population to know that the state cannot force gas stations to reduce this price. We can inform the population, make checks, inform the price so that the consumer can ask for this reduction for his gas station”, said Garcia, in an interview with CNN New Day .

The governor of São Paulo said that the tariff reduction should produce a drop of at least R$ 0.48 in the liter of gasoline at the stations.

“If you haven’t noticed this reduction in the last few days, ask your gas station manager, the gas station manager what is happening. The goal is for gasoline to reduce at the pump for all consumers,” he added.

Budget impact

The São Paulo state universities – USP, Unesp and Unicamp – have their budget derived from a transfer of 9.57% of the ICMS from São Paulo (5.02% to USP, 2.34% to Unesp and 2.14% for Unicamp).

The dean of USP, Carlos Gilberto Carlotti Junior, stated that the reduction of ICMS for fuels should lead to a decrease of R$ 1.03 billion per year in the budget of universities. In 2022, USP’s estimated budget is R$ 7.5 billion.

The estimate was made by the São Paulo Department of Finance and Planning.

Governor Rodrigo Garcia stated that the expected impact on revenue in general for this second semester is R$4 billion and R$400,000.

“The state and universities have reservations. We all have to make an effort this second semester to help the population,” she said.

“We hope that, with these measures, the Brazilian economy will turn around again, we will be able to have economic growth. Thus, with the decrease in the cost of living, the population will consume more and consequently the state will collect more. We are looking to stimulate a virtuous cycle,” she added.

“The big villain is Petrobras”

The governor claimed that ICMS is not to blame for the high fuel prices recorded in Brazil.

“The great villain is the public price of Petrobras. Here in São Paulo, since November of last year, the government froze the value of ICMS charged on diesel oil. We charge 13.2% on diesel, which is R$0.64 a litre,” he said.

“When we made this decision, diesel cost R$4.90. Today, at a service station, the same R$ 0.64 is still charged, of the 13.2% of ICMS, but the value of the liter has risen to more than R$ 7”, he added.

“ICMS is not the villain. The villain is the public price charged by Petrobras and the company’s astronomical profits in recent times”, concluded Rodrigo Garcia.

Source: CNN Brasil

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