Since the second half of 2022, a tax break on fuels was applied, lasting until the end of February. So, what has changed since then, and has it ended?

The issue is that the government was considering reinstating taxes on fuels. Therefore, starting March 1st, prices are expected to increase. But how did this process work?

However, which fuels were affected, how will this affect the population on a daily basis, and what are the tax rates? Furthermore, what taxes are being levied on fuel?

So, if you have all these questions, find out the answers to them all right now and understand the reintroduction of fuel taxes!

The tax exemption was implemented as a measure to try to mitigate the increase in fuel prices caused by the international conflict between Russia and Ukraine. Thus, the tax exemption was maintained from mid-2022 until the end of the year.

However, this tax relief movement demonstrates a certain fiscal irresponsibility, since the government's revenue depends on the profits generated by taxes on gasoline pumps.

However, even so, the current government, which took office at the beginning of the year, maintained the tax exemption for two months, until the end of February 2023. Thus, with the arrival of March, the issue resurfaced.

Therefore, the decision was made to reinstate the tax rates. But what does this imply, and when will it apply to all consumers, at which point will the price actually increase?

Before its expiration, the tax exemption applied to two fuel taxes: the CIDE Combustíveis (Contribution for intervention in the economic domain levied on operations carried out with fuels) and the PIS/COFINS.

These are two fundamental taxes, and the tax exemption would generate revenue of around R$26 billion per year for the Federal Government.

In this way, the measure is being interpreted as fiscal responsibility. This is because the country has a budget deficit that needs to be controlled.

But hold on, let's understand better why the tax exemption ended now!

Yes, starting in early March, the aforementioned taxes will be reinstated on fuel prices. However, only gasoline and ethanol will be affected. Diesel remains exempt from taxes.

This also serves as an attempt to minimize environmental impacts by encouraging the consumption of cleaner fuels.

On the other hand, the Ministry of Finance negotiated with Petrobras itself, and there was a reduction in the price charged for fuels, such as gasoline and diesel, at refineries.

This is an attempt to mitigate the anticipated tax increases, so as not to raise the final cost for the consumer so drastically. It's worth noting that the rise in fuel prices also affects other goods.

So, let's check how much the tax will be on the fuels mentioned. In the case of gasoline, the price should increase by approximately R$ 0.25 per liter! This value already includes both the tax application and the renegotiation.

Furthermore, ethanol will only see an increase of R$ 0.02 per liter purchased. In other words, there will be little practical impact on consumers' wallets from the reintroduction of taxes on this fuel.

On the other hand, diesel prices and taxes remain unchanged until the end of 2023. In fact, the price of diesel has been reduced by R$ 0.08 by Petrobras!

Keeping the price of ethanol lower is an attempt to stimulate its consumption and make it more competitive compared to gasoline!

It's worth highlighting that the decision not to refund taxes on diesel follows a measure that predates the fuel tax exemption in 2022. This is because it has a direct impact on logistics costs.

In other words, this is a fuel used in both freight trucks and public transportation fleets throughout the country! The goal is to maintain access to products and services for the most vulnerable population!

As we pointed out above, the Federal Government is experiencing a budget deficit that needs to be resolved, as it is around 2% below what was planned. This tax refund will resolve at least 1% of the deficit.

As already mentioned, this tax increase will generate more revenue for the State to work and invest in other areas of fundamental importance.

Moreover, the taxes returned with much lower values than before the fuel tax exemption was applied in 2022.

In this way, the market reacted well to this measure, as the responsibility shows the Government's intention to remain faithful to the management of public money, prioritizing the most vulnerable population during this time of crisis!

So, do you understand better why and how the fuel tax exemption ended here in Brazil starting in March 2023? Therefore, with the renegotiation with Petrobras, the prices are likely not to be so high!

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