Panel SA: Low income will pay less for fuel

Representatives of states on the commission that discusses ICMS losses on fuels agreed on a bill to be sent to Congress by the next administration that provides for the creation of a fund to subsidize low-income consumers in the purchase of gasoline and diesel whenever oil suffer discharge.

THE Sheet obtained a copy of the document. According to technicians who participated in the discussions this week, however, for the market to function well, the compensation fund will have to be implemented in conjunction with the proposal to reimburse states for losses with ICMS collection.

As the SA Panel reported, the agreement on ICMS losses is likely to end in agreement at the group’s next meeting in ten days.

Named Account, the fund can be supplied with dividends received from Petrobras and royalties paid to the Union for oil exploration.

It also has revenues from the Export Tax levied on sales of crude oil; financial investments of the fund, among other sources. Applications can only be made in debt securities.

There are several triggers that trigger the use of the price subsidy. In addition to the rise in oil (above a price yet to be defined), the reference price of Petrobras, an important supplier of inputs to refineries in the country, will also serve as a benchmark.

The subsidy will also vary depending on the fuel. The expectation is that gasoline and diesel will suffer more price intervention.

The price reduction benefit will only apply to low-income consumers. The bill does not stipulate this salary cap, a level that will be defined if the bill is sent to Congress by the new government.

For other consumers, the ICMS agreement with the states will be able to equalize prices, according to technicians involved in the discussions.

It will be up to the National Congress to validate the fund’s balance each quarter.

Julio Wiziack (interim) with Paulo Ricardo Martins and Diego Felix