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The discussion about the resources of a multimillion-dollar regional development fund is one of the main reasons for the struggle between the Minister of the Economy, Paulo Guedes, and the president of the Chamber of Deputies, Rodrigo Maia (DEM-RJ).
Behind the scenes, Guedes estimates that there is a new attempt to “bleed” the coffers of the Union and Maia’s trip to Recife, the day before yesterday, to address the tax reform with the Northeast Finance Secretaries, was interpreted by the minister as a gesture in this sense.
At the meeting, which took place in the morning, the Mayor assumed the role of “referee” of the discussion. In the evening, after receiving the administrative reform proposal from the government of Jair Bolsonaro in Brasilia, Maia announced the break with Guedes, arguing that the minister prohibited his dialogue with the economic team.
The desire of the northern and northeastern states to use part of the new Value Added Tax (VAT) to irrigate the controversial regional development fund has opened a series of divergences in the tax reform. The state government’s calculations indicate transfers of around R $ 480 billion in ten years.
The finance secretaries of the South and Southeast, however, estimate that the money would end up benefiting only the North and the Northeast, which gather relevant seats in the political chess of Congress. Together, these regions have 48 of 81 senators and almost half of the Chamber, 216 of 573 deputies.
“The idea of dividing the country into two blocks cannot be sold,” said Paraná Finance Secretary Renê García Júnior.
“Maia said that Congress will arbitrate. But the most important thing was that he agreed with the fund. Without the fund, there is no way to carry out the tax reform, as there will be no more tax benefits. How are they going to do the companies from the North and Northeast? The large consumer market is in the Southeast and South axis “, observed the Secretary of Finance of Pernambuco, Décio Padilha.
The attempt to avoid a new draft law for the Union, in compensation to the states and municipalities, was one of the arguments that Guedes used to cut the “direct link” between the Economy technicians and Maia. To the interlocutors, the minister has said that the government cannot open loopholes to create “another Kandir Law”, which provided compensation from the Union to the States for the ICMS exemption for exports and ended up becoming a legal dispute of a thousand millions of dollars. The agreement, closed only this year, foresees a transfer of R $ 65.6 billion between 2020 and 2037.
Wear
In practice, by opening up the confrontation with Guedes and even revealing that a lunch with members of the economic team had been canceled, Maia expressed an increasingly common sentiment in the government. The complaints that spread through the Esplanade and resound in the Planalto Palace are that the minister and his secretaries try to impose an agenda without considering the political calculations of President Jair Bolsonaro himself, who is already designing his strategy for the re-election project, in 2022 ..
Guedes has accumulated setbacks in recent weeks and, although no one in the government dares to say that he is leaving, the assessment is that the signs of wear are unmistakable. The man who was dubbed “Posto Ipiranga” in the electoral campaign, a term used synonymously with the fact that he would have full autonomy, began to be challenged without ceremony. Although Bolsonaro still says that support for Guedes is unrestricted, political decisions have shown otherwise.
In private conversations, Planalto aides and ministers admit disagreements between Bolsonaro’s will and Guedes’ will, who says that it is not up to him to do the math that could affect the popularity of the government. The main criticisms in the Planalto are that the economy acts without clashing with the other organs and ministries, often contradicting the political determination of the president and the legal orientation of the government.
The administrative reform sent to Congress the day before yesterday is cited as an example of the mismatch between the Bolsonaro government and “the Guedes government.” Promised since the campaign, the proposal was ready at the end of last year, but it was shelved precisely because it reached current employees, despite the president’s recommendation that this should not happen.
The information is from the newspaper The State of S. Paulo.
