On Friday, newly appointed Minister of Finance Dario Durigan announced that he is awaiting responses from Brazilian states concerning the federal government's proposal to eliminate the ICMS, a state tax, on imported diesel until the end of May. This measure aims to mitigate the escalating price of diesel resulting from the ongoing conflict in the Middle East. The Ministry of Finance's plan includes compensating states for half of the revenue loss incurred due to this tax exemption, which is expected to cost approximately R$ 3 billion per month, with the federal government pledging to reimburse R$ 1.5 billion of that amount monthly.

Durigan expressed optimism about the proposal's acceptance, stating that if it does not progress, it would signal a lack of commitment to ensuring that the population remains supported during these challenging times. He emphasized the urgency of the decision, which is set to be finalized by the end of March. The removal of the ICMS is positioned as a strategic move to help Brazilian consumers avoid further financial strain due to rising fuel costs.

The Minister's comments underline the Brazilian government's proactive strategy to address the economic repercussions of international conflicts, especially those impacting essential commodities like fuel. This type of intervention is crucial, given the potential fallout from external events on domestic economies, especially in a country with significant reliance on diesel for transportation and agriculture.