12.5% Increase in ICMS Causes Gasoline Prices to Surge Starting in February and Will Impact Consumers' Wallets

12.5% Increase in ICMS Causes Gasoline Prices to Surge Starting in February and Will Impact Consumers’ Wallets

Written by Roberta Souza

Published on 31/01/2024 at 22:02

Foto: Reprodução AutoEsporte

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ICMS Rising: National Council of Fiscal Policy Announces Significant Increase in Fuel Tax

According to the website AutoEsporte, starting on February 1st, Brazilian drivers will feel a considerable impact on their daily spending on fuel, as the Tax on Circulation of Goods and Services (ICMS) on gasoline will see a significant increase from R$ 1.22 to R$ 1.37. The National Council of Fiscal Policy (Confaz) was responsible for this decision, resulting in a 12.5% increase in the tax amount. How will this affect consumers’ pockets?

Gasoline, ICMS, Tax, fuel — Photo: Reproduction AutoPapo

ICMS Increase: Current Scenario and Changes in Rates Since 2022

The implementation of a fixed value for the ICMS, initiated in June 2022, aimed to contain the economic impacts of the pandemic and the crisis stemming from the conflict between Russia and Ukraine. However, the measure was reviewed after a year due to complaints from states and the Federal District about billion-dollar losses. The Federal Supreme Court (STF) negotiated an agreement to raise the fuel tax, establishing the cap at R$ 1.22 starting in June 2023, which impacts the gasoline price. Now, the increase in February 2024 raises questions about the stability of the ICMS.

Composition of Gasoline Prices: Understanding the Costs That Impact the Consumer

The increase in the ICMS represents only a part of the burdens that consumers face when fueling their vehicles. In addition to state taxes, the Social Integration Program (PIS) and the Contribution for the Financing of Social Security (Cofins) are federal taxes totaling R$ 0.69 per liter of gasoline. The share allocated to Petrobras and the distribution and resale costs also play significant roles in the formation of the final price. How does this composition directly affect the amount we pay at fuel stations?

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The Confaz decision raises questions about the taxation policy of fuels in Brazil, highlighting the complexity of the relationship between state and federal governments and the population. In this context, understanding the composition of the price of gasoline becomes crucial for consumers to be aware of the factors contributing to the constant increases at gas stations.

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12.5% Increase in ICMS Causes Gasoline Prices to Surge Starting in February and Will Impact Consumers’ Wallets

ICMS Rising: National Council of Fiscal Policy Announces Significant Increase in Fuel Tax

ICMS Increase: Current Scenario and Changes in Rates Since 2022

Composition of Gasoline Prices: Understanding the Costs That Impact the Consumer

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12.5% Increase in ICMS Causes Gasoline Prices to Surge Starting in February and Will Impact Consumers’ Wallets

ICMS Rising: National Council of Fiscal Policy Announces Significant Increase in Fuel Tax

ICMS Increase: Current Scenario and Changes in Rates Since 2022

Composition of Gasoline Prices: Understanding the Costs That Impact the Consumer

Learn More

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Brazil will harvest a record crop of up to 357 million tons of grains, but it does not have the capacity to store a large part of it. The storage deficit has reached the highest level in history and is equivalent to almost the entire production of Argentina.

Four times faster than the Concorde, capable of taking passengers from New York to London in less than an hour at Mach 5.5, and with an engine that switches from turbojet to ramjet mid-flight at Mach 3.5, the Hermeus Quarterhorse went from paper to its first flight in just 19 months.

Under nearly 2 kilometers of ice in Antarctica, scientists have discovered an ancient landscape sculpted by rivers up to 60 million years ago, the size of Wales, preserved as a time capsule that could help predict the advance of ice towards the ocean.

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