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Oil & Gas, Energy
Evaluating measures to soften fuel prices for final consumers has been a global trend. In Brazil, truck and car vouchers are one suggested mechanism, but what is the potential cost? Is it more or less than a fuel tax waiver?
Two scenarios for estimated annual driver voucher cost
In this report, we estimate the potential impact that alternative mechanisms would have on the Brazilian budget. We calculate that a possible truck voucher could have an annual cost of: 1) R$38bn, assuming one full tank per driver per month, or; 2) R$4.5bn, assuming a fixed R$400/month per driver. A cab/app voucher may cost: 1) R$3.2bn, assuming one full tank per driver per month, or; 2) R$4.5bn, assuming a fixed R$400/month per driver. Assuming the combined alternatives "2" discussed above, the annual cost would be R$9.0bn, significantly below the R$225bn we estimated a fuel stabilization fund would have cost in 2022. In addition to being less expensive, such vouchers could also be directed to categories that are affected the most by high fuel prices, not generalized to every final consumer (including high-income groups), as would be the case with a fuel fund. Thus, we believe such measures are more likely to be considered.
Not just a Brazilian discussion, as countries have adopted different mechanisms
Evaluating measures to soften fuel prices for final consumers has been a global trend, as various countries have adopted different mechanisms, including: 1) fixing prices (or limiting adjustments) in countries such as Peru, Thailand, Egypt and France; and 2) reducing taxes in countries such as South Africa, the UK and Belgium. In Brazil, the main mechanism so far was a fuel tax waiver (R$64.8bn) and vouchers for truck and cab drivers, as well as LPG consumers (R$12.3bn), according to EPBR.
Estimate methodology: Truck vouchers vs. cab/app vouchers
Truck vouchers: We estimate the annual cost to the government for truck driver vouchers, assuming c928k drivers, according to ANTT data, and 1) one full tank per driver per month (cR$3,413/month), at a total cost of R$38bn, or; 2) a fixed R$400/ month, at R$4.5bn/year. Cab/app vouchers: We estimate the annual cost to the government for cab/app driver vouchers, assuming c946k drivers, according to the most recent PNAD data; and 1) a benefit of R$280/month per driver, approximately one full tank of gasoline, at R$3.2bn or; 2) a fixed R$400/month, at R$4.5bn/year
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