State debt, a superb answer for Brazil | Vinicius Lummertz

Vinicius Lummertz is a former Minister of Tourism
Alan Morici

Vinicius Lummertz is a former Minister of Tourism

In an try to cut back the value of gasoline and diesel, which impacts inflation and polls, Congress permitted and President Jair Bolsonaro sanctioned the invoice limiting ICMS to gas, gasoline, electrical energy, telecommunications and public transportation by classifying them. items. and providers as important.

If for the buyer the measure means a hope to pay much less on the time of provide, alternatively, it represents a threat of lack of over R $ 100 billion per yr for states and municipalities (that are entitled to a share of it). assortment, 25%). Nonetheless within the dialogue section of the invoice, the governor of São Paulo, Rodrigo Garcia, introduced within the Federal Senate a logical and sensible answer to cut back gas costs and, on the similar time, to not penalize states and municipalities that can he was now struggling severe losses. in the price of important providers reminiscent of training, well being, public security, housing, social improvement and concrete infrastructure.

Rodrigo Garcia’s proposal – which might be prolonged to the opposite 26 items of the federation – was for the Federal Authorities to droop São Paulo’s debt to the Union for 2 years in order that the state may cut back ICMS on petrol and nil tax on petrol. fuels. “I take advantage of this cash that may be out of debt to zero ICMS on diesel, ethanol and cooking gasoline and to cut back gasoline. they don’t want PEC [Proposta de Emenda Constitucional] for that, “the governor mentioned.

It could be quicker – and in addition fairer, says the governor. Rodrigo Garcia recalled that São Paulo “has all the time helped and nonetheless helps Brazil: in 2021, our state despatched R $ 716 billion in taxes to Brazil. However the return to São Paulo was solely $ 25 billion [3,5%]”. Along with this brutal distinction, there may be additionally inefficient and poorly managed spending by the Union – that’s, it collects an excessive amount of, returns too little and nonetheless loses billions by poor funding.

Different states are penalized by the Union on this relationship between assortment and return. After São Paulo comes Santa Catarina, my dwelling state, which despatched BRL 97 billion to Brazil in 2021 however had solely BRL 7 billion (7.6%) again to put money into all sectors and core infrastructure. Then comes Rio de Janeiro, with revenues of BRL 329 billion and BRL 25 billion (7.6%) as an alternative – however Rio has the benefit of oil royalties. Then comes Paraná, with R $ 91 billion and Rs 10 billion (11.1%); Espírito Santo, R $ 30 billion and R $ 4 billion (13.8%); and Amazon, with R $ 20 billion and R $ 3 billion (14.5%).

A big and needy nation like Brazil wants extra funding. Nonetheless, in apply, the focus of sources in Brasília, with 58% of all tax revenues remaining within the Union, and solely 24% in states and 18% in municipalities, creates a scenario of utmost inequality, recalling that obligations reminiscent of well being, training and infrastructure have been taken to the highest by the 1988 Structure. After its adoption, taxes and contributions have been created and elevated, which have been directed to the Union.
Even with all this focus of sources in Brazil, our nation has been spending greater than it has been incomes for not less than 10 years, Governor Rodrigo Garcia recalled. To provide you an thought of ​​what this implies, Brazilian public spending has risen from 29.5% to 41% of GDP, the sum of all of the wealth produced by Brazil between 2008 and 2019. Then got here the pandemic – and the explosion. of the expenditure ceiling, in 2020 alone, of R $ 524 billion.

Furthermore, this public deficit has triggered a debt service (curiosity) estimated at between 600 and 700 billion lei in 2021 – there may be controversy between authorities figures and people of institutes and universities – whereas the Union has returned to states solely R $ . 197.4 billion, ie about 30% of this quantity for the Federation items to cowl the essential areas and the infrastructure. Because of this, public funding in Brazil has reached its lowest degree in historical past, because it did in 1947, in accordance with the Getúlio Vargas Basis – and is anticipated to fall additional. In spite of everything, how do you make investments if 95% of the Union price range is dedicated to fastened and obligatory expenditure, reminiscent of social safety and civil servants’ pay?

It’s essential to vary this state of affairs – and in a artistic means, as was the answer proposed by Governor Rodrigo Garcia, to droop the debt of São Paulo for 2 years, compensating the billionaire’s losses with the gathering of ICMS. I’ll go additional: it’s essential to do one thing on this regard, in case of emergency, with the debt of the States. In the present day, the Union is the “contractor” of the Federation’s items, as if the states and municipalities have been “alien” entities.

State debt might be instantly utilized to every of them in well being, training, safety, infrastructure and different precedence sectors. The Federal Authorities and the States would develop into “companions” in these works and investments, which might profit the 212 million Brazilians in 5,570 municipalities. Precedence work must be chosen by mutual settlement to extend the productiveness of the economic system – and thus strengthen the economic system itself and develop future collections.

These are the issues we have to deliver to society on this election – not minutiae, factoids, false information or quarrels in regards to the “much less unhealthy” future.

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