Coronavirus: the Senate approves a fiscal aid project for states and municipalities | Politics

The text was approved, after approximately six hours of session, by 79 votes against 1. Of the 81 senators, only Randolfe Rodrigues (Rede-AP) voted against. Senator Weverton (PDT-MA) chaired the session and therefore did not vote.

The project had already passed through the Chamber of Deputies, but, since it has undergone modifications, it will be necessary for deputies to re-analyze it.

The purpose of the proposal is to reduce the effects of the fall in tax revenues of states and municipalities due to measures to combat the spread of the disease, such as the closure of companies and businesses.

The text conditions the release of resources to local governments to the freezing of the salaries of public servants until December 31, 2021.

The only exception will be for civil and military officials of the states, the Federal District and the municipal areas of health and public safety, as well as members of the Armed Forces, directly involved in the fight against the pandemic.

The release of the salary readjustment to these professionals received the call of several parties and was made by the president of the Senate, Davi Alcolumbre (DEM-AP), who is also the reporter of the matter.

According to Alcolumbre, the president of the Chamber, Rodrigo Maia (DEM-RJ), stated that, after the vote in the Senate is completed, the bill will be put to a vote by the deputies on Monday (4), without further ado. changes.

If the deputies approve the text, without further modifications, the bill will be sanctioned by the President of the Republic, Jair Bolsonar.

• R $ 60 billion Union loans to states and municipalities to finance actions to combat the coronavirus;
• R $ 49 billion savings with the suspension of the payment of debts with the Federal Government and banks, such as BNDES and Caixa;
• R $ 10.6 billion potential savings from renegotiating contracts with international organizations;
• additional measures to simplify budgetary and contractual management to deal with the pandemic.

Money division criteria

The project establishes that, of the R $ 60 billion foreseen for the states and municipalities, R $ 10 billion are assigned to actions in the area of ​​health and social assistance:

• R $ 7 billion will be transferred to the states. The division criteria will be a formula that considers the Covid-2019 incidence rate (40% by weight) and the population (60% by weight);
• R $ 3 billion to the municipalities. The distribution criteria will be the size of the population.

The proposal initially determined that the other R $ 50 billion would be delivered half to the states and the Federal District, half to the municipalities.

However, during the vote, the senators decided to change the distribution percentage, leaving 60% with the states (R $ 30 billion) and 40% with the municipalities (R $ 20 billion).

In an unusual practice, the proposal was reported by the President of the Senate himself, who is normally responsible for carrying out the work. For this reason, the session was chaired by Senator Weverton (PDT-MA).

Right at the beginning of the session, around 5 in the afternoon, Alcolumbre justified the fact that he took charge of the complaint of the matter. He considered that the federal government had already indicated that it intended to veto the project approved by the Chamber and, therefore, it was necessary to renegotiate the terms of the proposal.

The vote lasted for about six hours due to changes that some senators wanted to make to the text. Throughout the discussions, the rapporteur accepted some, and in other cases the authors of the requests were convinced to drop their amendments.

The text approved by the Senate is quite different from that approved by the House. The proposal of the deputies recomposed, for six months, the losses of the states and municipalities with the collection of the Tax on the circulation of goods and services (ICMS, state) and with the Tax on services (ISS, municipal).

However, the project did not establish any counterpart on the part of the federated entities and received criticism from the economic team. The government also stated that the impact for the Union would be R $ 220 billion, higher than the R $ 88 billion initially requested by the governors.

During the process in the Chamber, President Rodrigo Maia even questioned the calculation of the impact made by the economic team and attributed the government’s criticism to a political dispute.

According to Maia, the resistance to the project was due to the fact that President Jair Bolsonaro (without a party) did not want to meet with Governors João Doria (São Paulo) and Wilson Witzel (Rio de Janeiro), with whom he rivals in the electoral field.