Guedes reinforces inability to pay court orders and asks for understanding of the STF

The Minister of Economy, Paulo Guedes, reinforced once again that, in order to comply with the Constitution and tax laws, the Union is unable to deal with the accelerated growth of the precatório account and other court rulings, such as the highlighted ICMS.

“We deeply respect not only the jurisprudence but also the decisions of the Supreme Court. We would never question the value itself, the R$90 billion. It’s not about questioning the number. The problem is the constitutional inability to carry out this execution”, he argued at a press conference to comment on the federal tax collection in July, which set another monthly record.

In his assessment, the Union’s debts due to court rulings are growing faster than the collection of taxes, which, without a solution, could cause an overflow in the ceiling and/or non-compliance with the Fiscal Responsibility Law (LRF).

“I have to give this alert. […] I need understanding from the Supreme, to make the modulation in a way that doesn’t make it unavoidable to break the LRF, break and pierce the Ceiling”, explain.

Despite the appeal, Guedes said he was confident that the Supreme Court would show understanding with the Executive in order to support a solution that would facilitate the execution of such debts.

Combined with inflationary pressure, Guedes reinforced that the precatory bill could make the expansion of the current Bolsa Família for the government’s new social program, Auxílio Brasil, unfeasible.

“Depending on the level of inflation, I can start the year by breaking the spending ceiling. […] My constitutional obligation is to say: This makes the Budget unenforceable. I can’t pay R$90 billion today without affecting the functioning of the public sector”, he added.