Brazil Lula signs decree cutting gasoline taxes, diesel subsidy

President Lula signed a decree reducing PIS/Pasep and Cofins rates on gasoline by R$0.63/liter and eliminating taxes on hydrated ethanol, effective September 10 to October 5, replacing MP 1,358/2026. A provisional measure authorizes a R$1.00/liter subsidy to diesel producers and importers. The move aims to curb fuel prices ahead of elections, but fiscal costs and duration remain uncertain.