Bolsonaro reaffirms that Petrobras can subsidize the purchase of cooking gas

RIO DE JANEIRO, BRAZIL – The President of Brazil, Jair Bolsonaro, reaffirmed that Petrobras has a fund of about R$3 billion (US$577 million) to make a program along the lines of the “vale-gas” voucher, to subsidize the purchase of cooking gas cylinders for the country’s low-income population.

“This proposal is quite advanced. It depends on small adjustments because Petrobras is not mine. It also has private shareholders. We are negotiating this,” said the president during an interview to Radio 96 FM, from Natal (RN), on Wednesday August 4. “The idea is to give a gas cylinder every two months to the people who receive Bolsa Família. This is the government’s idea,” he added.

Petrobras, however, had already ruled out last Saturday, July 31, the possibility of the government using company resources for the gas voucher. Bolsonaro said, in an interview to Programa do Ratinho on SBT, that the state-owned company had a reserve to fund the program. “Silva e Luna [the Petrobras president] has a reserve of R$3 billion to really help those most in need. It would be the equivalent – what is being studied so far – of a cylinder of gas every two months,” he said in the interview that aired last Friday, July 30.

Soon after the president’s speech, Petrobras clarified that “there is no definition” of the implementation and participation in eventual programs. Any decision will be “subject to administrative approval and the Company’s internal policies.”

The reduction in the price of bottled cooking gas is a campaign promise of Bolsonaro that has not yet been fulfilled. In August 2019, the government ended the subsidy for the 13-kilogram cylinder – there was a discount only for the filling, offset by all other sizes sold at higher prices.

On the other hand, this year, the government decided to zero the collection of federal taxes on the bottles permanently. Through a law approved in Congress and sanctioned by the President, the government zeroed the PIS and Cofins taxes, which represented 3% of the final price of the bottles.

To compensate for the loss in revenue with this measure, the government increased the tax on banks, put an end to an incentive program for the petrochemical industry, and limited the purchase of cars with an exemption for people with disabilities.

In this Wednesday’s interview with a radio station in Natal, the president said again that the high price of cooking gas is due to the ICMS, a state value-added tax, the freight charges, and the profit margin of those selling. “I did my part, zeroing the tax on cooking gas,” he said.