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Bolsonaro considers Petrobras, fuel tax changes

SÃO PAULO, October 26, 2018 – The frontrunner in Brazil’s presidential election, Jair Bolsonaro, is contemplating changing the country’s fuel tax regime and installing someone with a military background to head state-owned Petrobras, international media reported Thursday.

Introducing a level of flexibility to the current fuel tax system would be aimed at smoothing out volatility in the prices consumers pay for diesel, an issue that has played a major role in recent developments at Petrobras and in the wider economy.

 

In May, a massive truckers’ strike over rising diesel prices resulted in losses worth billions of US dollars for the domestic economy, putting extreme pressure on the government and Petrobras. In response, the NOC’s CEO, Pedro Parente, tendered his resignation and was replaced by Ivan Monteiro.

Now, if elected, Jair Bolsonaro will again shake up Petrobras’ management by replacing Monteiro with a “military name,” sources say, though no specific person has been publicly announced.

Bolsonaro, representing the right-wing Social Liberal Party, took 46% of the vote in the election’s first round on October 7, failing to meet the 50% threshold required to win. A second vote on just Bolsonaro and his main competitor, Fernando Haddad of the leftist Workers Party, will occur this coming Sunday.

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