Finance Minister Fernando Haddad said on Monday (22), in São Paulo, that the establishment of fiscal policy and the balance of public accounts do not depend only on the Ministry of Finance or the Executive Power, but are also responsibilities of Congress and the judiciary.
According to the minister, the growth of parliamentary amendments and precatory – Union judicial debts – have caused a lot of pressure on the budget. The minister recalled that a working group was created to establish constant contacts with the judiciary to explain the impact that some lawsuits have on the budget.
“You like it or not, and I’m not making a value judgment, we have $ 50 billion of parliamentary amendment. The precatory, which is not about decision made by this government, practically doubled in size. You had an average precatory between $ 50 billion and 60 billion. Today, you have $ 100 billion,” said the minister to participate in the event macro day, promoted by BTG Banco Pactual.
The minister criticized the thesis of the century, a decision of the judiciary in which companies gained the right to withdraw the ICMS, the main state tax, from the PIS/Cofins federal contributions base.
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“We are talking about a fall of more than $ 1 trillion of collection loss. I estimate that 10% of GDP (Gross Domestic Product, sum of the goods and services produced in the country) of our public debt is a consequence of this decision made by the Supreme Court by 6 to 5 on the scoreboard [da Tese do Século]”Haddad said.
The minister also criticized the fact that a good part of current government spending, and equivalent to the 0.5 percentage point of GDP, refer to the expansion of permanent expenses that were still hired under the government of former President Jair Bolsonaro, resulting from changes in the continued benefit (BPC) and the Fundeb Basic Education Maintenance and Development Fund). These expenses, according to the minister, are equivalent to about $ 70 billion.
“We are not [do atual governo] That we are spending, but we are honoring an expense that was hired in 2021 and from which we could not leave, ”said the minister.
The minister also argued that it is necessary to create political conditions for the tax framework to be strengthened, expanding the dialogue with Congress.
“For him [arcabouço] Being strengthened, you need to create the political conditions of sitting with parliamentarians and saying ‘we will need to adjust some rules, otherwise the framework won’t be sustainable in the long run,’ said Haddad.
Raising fury
The minister denied that the government is increasing taxes or that only “think about raising”. According to him, this “raising fury”, which is cited to refer to the current government, occurred, in fact, during the military dictatorship, when the Brazilian tax burden as a proportion of GDP rose from 16% to 26%.
“What is happening now compared to what happened in the past? None of this is happening. We are replacing money lost over two decades to reach a level in which we control the expense, and recomposing the fiscal base, we are able to sustainability,” he explained.
“It’s not true, even if there was spending [no atual governo]as some want, even if there is a fury collection, “he said.
Legacy
The minister stressed that he intends to deliver a better Brazil when leaving the Ministry of Finance. Lula’s legacy in the economic area, according to Haddad, will be positive for the country and also for future generations.
“We will have the best average growth in the last 12 years or more; the lowest inflation of one term since the Real Plan; the lowest unemployment rate in the historical series; the best fiscal performance of the last three terms and the largest tax reform ever done under any regime,” he said.
“I want to get out of this position the same way I left all the positions I held. I want to go out and can find you under any circumstances and can talk about Brazil, about the best way to our country, how to improve investment degree, how to improve public accounts, how to make money reach and how to have a little more tax justice in such an unequal country,” Haddad said.
“If we go wrong or get it right, the story will say. But everything was done very tough, willingly. I think we will reap the fruits of this work that is not complete because the work of driving the economy will never be complete.
