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LatinNews Daily - 19 February 2021

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In brief: New announcement on fuel prices in Brazil

* Brazil’s President Jair Bolsonaro has announced that the government will temporarily suspend the PIS/Cofins federal tax on diesel, which is set at R$0.35 (US$0.06) per litre, effective for two months from 1 March. Bolsonaro also announced the permanent zeroing of the PIS/Cofins tax on cooking gas (liquefied petroleum gas, LPG). Speaking during his weekly Facebook Live broadcast, Bolsonaro said that the government would seek a way to permanently get rid of the federal tax on diesel during the initial two-month suspension, as a way of counteracting the increase in fuel prices. State-owned oil company Petrobras, which is responsible for setting fuel prices in the country based on the price of oil on the international market, has already increased prices on fuel in refineries four times this year, generating discontent amongst consumers, notably lorry drivers, who have put pressure on the government. Bolsonaro has separately sent a bill to congress seeking to modify the way the ICMS state-level tax is levied on fuel, notably proposing that it be a fixed tariff uniform across the country, rather than a percentage rate set individually by each state government.