Brazil's Governors Resist Federal Proposal to Eliminate ICMS on Basic Food Basket

Brazilian Vice-President Geraldo Alckmin acknowledged resistance from state governors regarding the federal government's proposal to eliminate the Tax on Circulation of Goods and Services (ICMS) on basic food basket items. This proposal was introduced as part of measures to reduce food prices, including the exemption of import tariffs on items like corn, coffee, and meats. Governors have argued against the measure, stating that many already apply a zero rate to essential products. The Governor of São Paulo, Tarcísio de Freitas, noted that the basic food basket is already exempt from ICMS in the state. Eduardo Leite, Governor of Rio Grande do Sul, echoed this position, highlighting that his state already has a zero ICMS rate for several basic food basket items, such as eggs, milk, French bread, and fruits and vegetables. Leite also emphasized the state's ICMS refund program for low-income families, which has returned over R$ 800 million to taxpayers in the last three years.