BRAZIL: UNICA urges congressmen not to withdraw ethanol incentives

Published: 05/31/2018, 8:20:04 AM

The president of sugarcane industry association UNICA said Tuesday that ethanol helps lower gasoline prices and that its contribution will be even stronger as the government's program to incentivize renewable fuels, RenovaBio, is fully implemented, according to Brazil's Estadão Conteúdo newswire.

Elizabeth Farina urged congressmen to not dismantle the taxation model that makes ethanol competitive in relation to gasoline, allowing further development of the sector.

Congressman José Carlos Aleluia, from the Democrats (DEM) party, said that fuel trade in Brazil suffers from "imperfect competition".

Arnaldo Jardim, representing Brazil's Popular Socialist Party (PPS), criticized the decision by president Michel Temer to establish minimum freight rates in order to end a nine-day truckers strike.

"This (measure) is an artificiality that will generate higher prices further ahead," he said.

Temer has also agreed to reduce diesel prices for 60 days by BRL0.46, a value equivalent to the PIS/Cofins tax, and to establish monthly price adjustments after that period.

Jardim said that zeroing PIS/Cofins will force the government to cut budgets in other sectors.