Lula da Silva says he accepts Central Bank’s independence, but proposes changes

On Tuesday, September 27, the former president and Workers’ Party (PT) candidate for the presidency, Luiz Inácio Lula da Silva, said he saw no problem in the Brazilian Central Bank’s (BC) independence but advocated changes in the institution’s performance.

For the Brazilian presidential candidate, besides setting the interest rate and controlling inflation, the Central Bank also needs to set economic growth and employment targets.

“Because the Central Bank’s purpose is to ensure that inflation is controlled. And the only mechanism it has is to increase the interest rate. It is necessary to create another mechanism.

“The Central Bank needs to assume another responsibility”, he said in an interview with the SBT TV news program.

Da Silva declared that in his two terms (2002 to 2010), he never interfered in the bank’s policy, which was headed by Henrique Meirelles during the period.

“When I was elected, Meirelles was already independent. I didn’t get involved in Meirelles’ politics; he did what he had to do,” he said.

The petista also said that, if elected, he intends to talk with the president of the Central Bank, Roberto Campos Neto, who he classified as a “reasonable” person and “competent economist”.

“We will talk with the president of the Central Bank, who is certainly a reasonable person to talk to, a competent economist. Let’s talk. But it doesn’t cause me any problem [Central Bank] being independent or not,” he said.

Campos Neto’s mandate lasts until December 2024, halfway through the government elected in October.

VAT ON FUEL

Lula da Silva also said he does not intend to change the legislation that established 17% or 18% ceiling for the ICMS (Value-Added Tax on Sales and Services, Brazilian VAT) fuel rate.

The limitation was presented by Bolsonaro’s government and approved by Congress in June. The goal was to reduce the value of gasoline in the country.

“It is not discussing the ICMS. The Supreme Court has already approved that the ICMS will reduce starting next year. I don’t want to mess with politics that belongs to the governor. The governor takes care of his taxes,” he said.

The former president affirmed that Bolsonaro’s decision to reduce fuel prices by reducing taxes was “eminently political” and happened because he “didn’t dare to contradict the company’s management and foreign shareholders.

“It was tinkering to try to show that he could win politically. He will see the damage when the money for health and education starts to run out. And the responsibility will be his,” he said.

The ICMS collection ceiling approved by Congress also applies to the energy, transportation, and telecommunications sectors.

Da Silva also said that Petrobras needs to define a fair price for gasoline and defended the change in the price policy of the state company.

“Petrobras does oil prospecting in real; it refines in real, so it needs the price to be in real,” he said.

During the interview, Lula da Silva also promised again that he would revoke the so-called spending cap, classified by him as a policy of those who “don’t know how to govern.

THE WHISTLE-BLOWER LAW

During the interview, da Silva also criticized the “Delação Premiada” (prized whistle-blowing) law and said that the rule “was used in Brazil to enrich thieves.”

“Everyone who did a whistle-blower got rich. They left with a pocket full of money; there are people smoking cigars on the beaches in a penthouse with money from Lava Jato,” he said.

The PT politician defended that Justice should only condemn someone with proof: “What we have to do is to change the behavior of Justice. Justice has to judge, and after it has evidence, it can acquit or convict people.

Lula da Silva also said that the statement by the United States government that they will “monitor” the Brazilian elections means that it is “necessary to recover democracy in Brazil.”

“The meaning is that the United States needs a democratic Brazil with a government that knows how to maintain international relations. A protagonist Brazil because Brazil is very important in South America, very important in the world,” he said.

With information from Poder360