Bolsonaro proposes Brazil Aid of R$405, despite promising R$600

Bolsonaro proposes Brazil Aid of R$405, despite promising R$600
Bolsonaro proposes Brazil Aid of R$405, despite promising R$600
The Chief Executive follows in second place in the polls of voting intentions (photo: Miguel SCHINCARIOL / AFP)

The Jair Bolsonaro government (PL) presented this Wednesday (31) its proposed Budget for 2023 with an average benefit of BRL 405 for Auxílio Brasil, below the floor of BRL 600 to be paid to families between August and December. this year.

In the midst of the electoral campaign, the presidential message sent along with the project contains Bolsonaro’s promise to seek the resumption of the R$ 600, but without detailing how this will be done.

The inclusion of this signal, considered by technicians as unusual, was the solution found by the political wing of the government to try to anticipate criticism from opponents, at a time when the Chief Executive follows in second place in the polls of voting intentions.

First in electoral surveys, former president Luiz Inácio Lula da Silva (PT) has exploited the absence of R$600 in budget pieces as a factor to wear out Bolsonaro.

The PT campaign also promises to maintain the minimum benefit of R$ 600. In addition, Lula’s team announced this week its intention to pay an additional R$ 150 to children aged zero to six years, as shown by Folha de S.Paulo. .

From a technical point of view, the government needs to forward the Budget following the current rules – such as the spending ceiling, which limits the advance of expenses to the variation of inflation. As there is no room to accommodate the additional cost of BRL 52.5 billion arising from the extra BRL 200 in 2023, the proposal was left out of the text.

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BRL 105.7 billion was reserved for the Auxílio Brasil program, enough to fund the minimum of BRL 400 to 21.6 million families. According to the Ministry of Economy, the average benefit will be R$ 405.21

The government could include the expenditure conditional on the approval of a PEC (Proposed Amendment to the Constitution) to change the spending limit, but there is still no closed proposal to that effect. In addition, filing a PEC in the middle of the election campaign could leave the president exposed to more criticism.

In the message, the president limits himself to saying that “the Executive Power will send efforts in search of legal solutions and budgetary measures that allow the maintenance of that value in the year 2023, through dialogue with the National Congress to meet this priority” .

This Tuesday (30), Bolsonaro even said that he would use the money from the sale of state-owned companies to pay for the permanent expansion of the program. The collection of these resources, however, does not solve the obstacle of the expenditure ceiling.

For beneficiaries of the social program, the photograph of the Budget proposal indicates that 2023 will be the fourth year in a row of uncertainties about the amount available for buying food and paying bills.

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Since 2020, with the beginning of the Covid-19 pandemic, low-income Brazilian families have been living on a “roller coaster of poverty”, as researchers Marcelo Neri and Marcos Hecksher classified in a work published by FGV Social.

The Auxílio Gás program will also have a drop in the value of the benefit, according to what was proposed in the submission of the Budget. Today, 5.7 million families receive R$ 110 every two months, thanks to a temporary increase approved through the PEC of kindnesses.

In the project presented this Wednesday, the expenses reserved for Auxílio Gás total R$ 2.2 billion, enough to pay an average benefit of R$ 65.70 every two months for 5.7 million families.

Other promises made by Bolsonaro were also left out of the Budget, such as the correction of the IRPF (Individual Income Tax) table.

The president had already included this commitment in his government program during the 2018 election campaign, but it remained only on paper. Now, it has been renewed by the president, who signaled the exemption of earnings up to five minimum wages “during the 2023-2026 administration”.

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The IRS has already prepared a range of scenarios with more than one hundred combinations of changes. The salary ranges used to apply the Income Tax discount have been frozen since 2015 – which, in practice, means a higher tax burden for families.

Any change, however, will mean loss of revenue for the Union. Minister Paulo Guedes (Economy) has defended the resumption of the IR reform project, which immediately expands the exemption range to R$ 2,500, changes taxation on companies and resumes the collection of tax on profits and dividends. distributed to individuals, currently exempt.

“Over the last few years, the debates about the need for advances and adjustments in the national tax system have matured, so that consensus will be sought with Parliament and society to implement the reform and the respective correction of the income tax table” , says the presidential message.

On the other hand, the proposal presented by the government includes maintaining the exemption of federal taxes on fuel, as shown by Folha de S.Paulo. The measure, adopted by Bolsonaro amid the sharp rise in the price of gasoline and diesel, means giving up BRL 52.9 billion in revenues in 2023.

The inclusion of the exemption in the Budget also throws any eventual decision to raise taxes again in Lula’s lap, in case the PT wins the elections and wants to restore federal revenues.

Other tax exemptions, of a general or sectoral nature, were also maintained, with an impact of R$ 27.2 billion. Altogether, the exemptions total R$ 80.2 billion.

In this scenario, the government’s official forecast is that there will be a deficit of R$ 63.7 billion in 2023. Despite this, members of the economic team are optimistic about the possibility of maintaining the good performance of the collection next year, reducing the gap in the accounts.

“We are being prudent in measuring revenues,” said the special secretary for the Treasury and Budget, Esteves Colnago.

In terms of expenses, the government defined the inclusion, in the Budget proposal, of a reserve of R$ 14.2 billion for the granting of readjustments to the federal civil service, of which R$ 11.6 billion for the servants of the Executive Branch. This amount is within the spending ceiling.

There is still no decision on the format of the adjustment, but government sources say that the increases may be selective, that is, for some careers. As shown by Folha de S.Paulo, the government is studying using the inflation forecast for 2023 as a reference for readjustments, given that it will be lower than this year’s.

About one million civil servants have their salaries frozen since 2017. Other categories, with higher salaries, had the last adjustment in 2019. This year, Bolsonaro tried to contemplate only the police, but the movement triggered reactions from other careers and the president gave up. of bounty.


Brazil aid

It was foreseen with a minimum payment of R$400, despite Bolsonaro’s promise for R$600. In the message that accompanies the proposal, the government says that it will make an effort in Congress to add the R$200

Income tax

The proposal does not include a readjustment of the Income Tax table or the expansion of the exemption range, despite Bolsonaro’s promises made in 2018 and also this year.

fuel subsidy

Text provides for the continuation of the cut in fuel taxes, implemented in 2022 to contain prices at gas stations. There will be BRL 52.9 billion for the measure (BRL 34.3 billion for the reduction of PIS/Cofins and Cide on gasoline, ethanol and CNG; and BRL 18.6 billion for the exemption of PIS/Cofins on fuel from productive sector (diesel, LPG, aviation kerosene, etc.)

Reset for servers

Reserve of BRL 14.2 billion for increases in civil service (BRL 11.6 billion for the Executive)

Result of accounts

Estimated deficit of BRL 63.7 billion for the central government (which includes the Treasury, BC and Social Security) in 2023, but the government says the result should be better than that

The article is in Portuguese

Tags: Bolsonaro proposes Brazil Aid R405 promising R600

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