Brazil Zeroes Gasoline Taxes for 30 Days Before Runoff
Brazil cut federal gasoline taxes to zero for 30 days, worth about US$0.18 a litre, and widened diesel and ethanol aid 16 days before the 25 October runoff. The post Brazil Zeroes Gasoline Taxes for 30 Days Before Runoff appeared first on The Rio Times .
On October 9, Brazil's government announced a 30-day suspension of gasoline taxes, effective immediately. The Finance Ministry stated the tax relief would reduce the federal gasoline tax to R$0.89 per liter, a discount of R$0.79 per liter compared to the current rate. Prime Minister Luiz Inácio Lula da Silva's administration is using the move to protect drivers from soaring oil prices, which have surpassed $100 a barrel.
The government estimates the temporary relief will cost R$5.2 billion over the next 30 days. The policy also includes a 30-day increase in diesel import subsidies and continues its ethanol producer subsidies. The measure is timed to run through the October 25 presidential runoff. Critics argue the fiscal policy is unsupportable, with some estimating gas prices could exceed R$9 per liter without support.
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