Brazil’s 2025 Budget Bill proposes a primary surplus of 15 billion reais, up from 3.7 billion. Revisions come from increased revenue projections and changes requested by the federal government. The budget’s delayed approval signals challenges in relations between President Lula’s administration and Congress.
Brazil’s 2025 Budget Bill anticipates a primary surplus of 15 billion reais ($2.66 billion), an increase from the previously suggested 3.7 billion reais. This revision was introduced by Senator Angelo Coronel and is scheduled for a vote in a joint budget committee before proceeding to a full congressional session. The revision reflects upward adjustments in revenue projections, enhancing the forecast for the primary balance.
In 2023, President Luiz Inacio Lula da Silva established a new fiscal framework that targets a primary balance while capping spending growth at 2.5% above inflation. For the current year, the government aims for a zero primary deficit, allowing a margin of 0.25% of gross domestic product (GDP). This permits a possible deficit of 30.9 billion reais while still adhering to fiscal rules.
Senator Coronel included modifications based on the federal government’s requests, such as increased funding for social security benefits and a cut in Bolsa Familia program expenditures, which provides monthly stipends to qualifying families. The late approval of this year’s budget highlights the ongoing difficulties in the relationship between Lula’s left-leaning administration and Congress, as the budget is traditionally finalized before the preceding year’s end.
The revised 2025 Budget Bill reflects a significant increase in projected primary surplus for Brazil, bolstered by adjusted revenue forecasts. The established fiscal framework offers a balance between targeted expenditures and a controlled deficit guideline, yet the delay in approval underscores existing legislative challenges. Overall, the budget aims to support social security while managing spending on welfare programs in a politically complex environment.
Original Source: money.usnews.com
