Tankers Threaten to Strike and Want to Reduce Diesel Taxes in Mines – Economy

In February, tankers' strike caused a queue at gas stations.
In February, tankers’ strike caused queues at gas stations in BH (photo: Alexandre Guzanshe/EM/DA Press – 02/26/2021)

With gasoline and ethanol on the rise, the Union of Transport Companies for Fuels and Petroleum Derivatives of the State of Minas Gerais (Sindtanque/MG) continues to pressure the government of Minas to reduce taxes on diesel, the main supplier of vehicles of cargo. This Thursday (8/26), the category threatened a strike if there is no reduction. Currently, the rate of the Tax on Circulation of Goods and Services (ICMS) for diesel in Minas Gerais is 15%. Tankers want this rate to drop to 12%.

According to the category, in the February strike, Governor Romeu Zema (Novo) promised that he would reduce the ICMS on diesel. But, that hasn’t happened yet.

When contacted, the government informed that “the entity’s claim” was presented to the National Council for Finance Policy (Confaz) in July. However, the finance departments of the 26 states and the Federal District rejected the ICMS reduction.

For the change to take place, Confaz would have to unanimously approve the reduction. “Therefore, the version that the government has promised such a reduction is not valid”, clarified the administration Romeu Zema.

“The input, in this case diesel, corresponds to about 70% of freight costs”, informed the tankers in the statement.

The president of Sindtanque, Irani Gomes, affirms that the category is in a “strike state” and can cross its arms “indefinitely, as never seen before” in Minas.

“We received a negative (from the government). Soon, the category decided to go on strike and can stop at any time. There is no set day or time. People like to take it by surprise,” said Irani Gomes to State of Minas.

How is the price set?

ICMS is not the only factor influencing fuel prices. There are also the costs of distribution and resale, inputs, federal taxes and Petrobras itself.

In the case of diesel S10, for example, the price is defined according to the percentages below:

  • 10.9% – Distribution and resale
  • 11.2% – Biodiesel cost
  • 15.0% – ICMS
  • 7.0% – Cide, Pis and Cofins
  • 55.9% – Petrobras Price

The ICMS for diesel in Minas has been 15% since January 2012, when it went from 12% and jumped to the current percentage.

“That said, it is important to make it clear that the latest readjustments in fuel prices are not due to the ICMS charged by the state, but rather to the pricing policy adopted by Petrobras,” the government explains in a statement.

But, for the president of Sindtanque Irani Gomes, ICMS is the one that most influences the final price.

“ICMS is the tax that most increases fuel. When the price increases, not only diesel, but the entire chain, consumption, ends up falling and affects the issue of work. Another problem that slows down transportation. And diesel oil, as the primary fuel chain, impacts on other fuels. Nothing reaches its destination if it doesn’t have transport,” he says.