Brazil’s Finance Minister Fernando Haddad continues to push publicly for measures to boost revenues and help balance the country’s budget by 2024, while Congress resists approving them.
Brazil’s Finance Ministry needs a revenue increase of about 200 billion reais ($40 billion) to fulfill its plan to end the projected deficit of 150 billion reais ($30.2 billion) by 2023 with a balanced result in 2024.
The strategy adopts a number of measures, including taxes on offshore corporations, closed-end funds, and dividends.
But those proposals require congressional approval, and lawmakers, including House Speaker Arthur Lira, have been reluctant to push them through, according to Bloomberg.
As the deadline approaches, the Ministry of Finance realizes that it is running out of time, according to two anonymous sources cited by the US media. On August 11, Haddad publicly expressed his dissatisfaction with Congress and with Lira, which had told the minister that he was not willing to put the extraterritorial taxation measure to a vote.
During an interview with local media, Haddad criticized the amount of public funds given to lawmakers for projects in their home states as part of the federal budget and stated that while the lower house of parliament is powerful, it should not use its authority “to humiliate the Senate and the federal government.”
These comments led the president of the Chamber of Deputies to postpone meetings with party leaders to discuss a vote on Brazil’s new fiscal framework, a proposal to shore up the country’s finances that needs approval from the lower house at the end of August, when the government will present its draft budget for 2024.
The finance minister tried to smooth relations with the National Congress, and they are now expected to meet to debate the vote on the budget plan on August 21, and his team is confident that an agreement between Brazilian leader Lula da Silva and Arthur Lira can pave the way for the fiscal bill to be passed in time to adjust the economic plan to the new spending rules.
