20/10/2023 – 21:55
Governor Tarcísio de Freitas (Podemos) vetoed the bill approved by the Legislative Assembly that exempted the payment of Motor Vehicle Ownership Tax (IPVA) for electric cars. The objective of the project was to encourage the use of less polluting vehicles in the State.
The reason for the veto was exposed this Friday, 20th, in the Official State Gazette. Also this Friday, the governor sent another urgent project proposing the exemption “exclusively for hydrogen and hybrid vehicles with an electric engine or combustion engine that alternatively or exclusively uses ethanol”.
If approved, the measure will be valid between 2024 and 2025 for cars costing up to R$250,000. Afterwards, these models will gradually pay tax of 1% to 4% between 2026 and 2029.
In justifying the veto of the project sent by Alesp, he stated, among other reasons, that the proposal “is out of step with the vigor of ethanol production and the prospects for using biomethane produced in the State”.
In his project, he also includes the IPVA exemption for buses or trucks powered exclusively by hydrogen or biomethane between 2024 and 2028. According to him, the measure stems from studies carried out by the Secretariat of Finance and Planning.
“There is a lack of depth in this debate, especially from public authorities, and I think the governor should delve a little deeper, as should his team, to understand where it is possible to maximize decarbonization and not treat things with limits,” he said. the president of the Brazilian Electric Vehicle Association (ABVE), Ricardo Bastos.
Another question is that flex hybrid cars can currently be fueled with ethanol or gasoline. Currently, taking flex combustion models as a basis, 70% of users fuel up with fossil fuel, and 30% with ethanol.
Three technologies available
In Bastos’ opinion, Brazil, and particularly São Paulo, has the possibility of working with a combination of the three technologies available for decarbonization (hybrids, plug-in hybrids and electric), as the country’s energy matrix is clean and has biofuels . “We can work from biofuels to electrical energy and our automobile industry is strong and can produce them all,” he said.
In April, when visiting the Great Wall Motor (GWM) factory in Iracemápolis – acquired from Mercedes-Benz -, Tarcísio de Freitas announced that he intended to remove the IPVA charge for hybrid and electric cars in 2024. At the time, he stated that his intention was “reduce or more likely zero the IPVA of these vehicles.” The electric Dolphin, imported by GWM, was the best-selling electrified model in the country in September.
Another justification given by the governor is that the granting of tax incentives must consider, among other aspects, the specificities of São Paulo’s energy matrix, fundamentally the diversity and abundance of energy resources available in the State originating from biomass.
Bastos counters the statement by stating that the State forgets that 30% of its energy is generated from biomass, often from sugarcane bagasse. “So, when I fuel an electric car, I am using 30% energy from sugarcane bagasse”, which is a biomass.
On Thursday, the 19th, the governor of Minas Gerais, Romeu Zema (Novo) stated that “the electric vehicle is a threat to jobs”. In a statement, ABVE expressed its disappointment with the statements “hostile to the development of the electric and hybrid vehicle market in Brazil” by Zema and Tarcísio.
The entity declared that it was surprised by the position of the two governors if one considers that the firmest investments announced by the automotive sector in recent months are precisely in new technologies and renewal of production lines to manufacture this type of vehicle in the country, including the acquisition of deactivated industrial plants.
“It makes no sense for authorities in the country’s main states to create insecurity for companies that have already committed to generating quality jobs and bringing technological innovation to Brazilian industry,” said the president of ABVE.
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