President Jair Bolsonaro announced this Thursday (20) that he is negotiating the presentation of a Proposal for a Constitutional Amendment (PEC) to allow the reduction to zero of the incidence of federal taxes on fuel. The text has not yet been made available, but the targets of the reduction would be the contribution of the Program for Social Integration and Formation of Public Servant Assets (PIS/Pasep) and the Contribution for Financing Social Security (Cofins).
“We have a Proposal for Amendment to the Constitution, which is already being negotiated with the Chamber and the Senate, so that we have the possibility of practically zeroing fuel taxes, PIS and Cofins”, he said during his speech. live weekly on social media. The president is in Suriname, where does an official visit. 
According to Bolsonaro, there is a process of generalized inflation that does not only affect Brazil. In 2021, the gasoline accumulated a rise of 47.49% and ethanol, 62.23%, according to the Brazilian Institute of Geography and Statistics (IBGE). Diesel had an increase of about 47% in the same period.
In addition to federal taxes, the sale of fuel also pays the Tax on the Circulation of Goods and Services (ICMS), which is a state tax, and therefore, would not be covered by an eventual approval of the proposal announced by Bolsonaro. With the constitutional change, the government would not be obliged to offset the reduction in fuel taxes with the increase in other taxes, as determined by the Fiscal Responsibility Law (LRF). The government did not give an estimate of how much it would cost to zero federal taxes on fuel.
In 2018, after the truck drivers’ strike, the then government of Michel Temer zeroed federal taxes on diesel, but by means of a decree and with corresponding budgetary compensation through the increase of other taxes. Between March and April of last year, the Bolsonaro government suspended the collection of taxes on diesel, a decision that was offset by the increase in the tax burden in other sectors.
