Government tax burden estimated at 31.64% of GDP in 2020

The Gross Tax Load of the general government is estimated at 31.64% of GDP in 2020, the National Treasury. The figure is 0.87% lower than that observed in 2019, when it stood at 32.51% of GDP. By this estimate, the tax burden last year was the lowest since 2010. According to the Treasury, the drop is explained mainly by the effects of the covid-19 pandemic on economic activity and tax exemptions granted as a result of the health crisis.

Source: UOL Ecomomia

Parliamentary amendments reach a record of $8.7 bn

The volume of parliamentary amendments proposed by Congress for this year’s budget, R$ 48.8 billion ($8.7 bn), is a record and exceeds the value of all previous years. These resources are usually indicated by deputies and senators for works and projects in their own electoral districts. Over time, parliamentarians have acted to gradually increase control over the Budget.

Source: 6 Minutos

Federal revenue has best result for the first two months of the year since 2000

The federal tax collection grew 4.3% in real terms in February and accumulated in the two months the highest result for the period in 21 years, but the government warned that the resurgence of the pandemic should impact the collection of taxes from mid-March. Last month, tax revenue totalled R$127.7 billion ($23 bn), the Federal Revenue Service said. The figure came above expectations for collection of R$124.9 billion ($22 bn), according to a Reuters poll of analysts

Source: 6 Minutos

OECD links growth to judicial efficiency in Brazil

A study by the OECD suggests that Brazil needs to reduce judicial inefficiency and uncertainty in order to boost economic activity and overcome the current deep recession caused by Covid-19. Bankruptcy proceeding are also considered less efficient and more costly than in OECD members. A typical insolvency case takes four years in Brazil compared to 1.8 year in developed countries. Since the assets of companies in bad shape tend to lose value quickly, the debt recovery rate in Brazil with bankruptcies is only 18 cents per dollar, compared to 68 cents in rich countries.

Source: Valor International

Ministry maintains economic growth forecast at 3.2% this year

The Secretariat of Economic Policy (SPE) of the Ministry of Economy maintained the projection for economic growth this year and raised the estimate for inflation, under the influence of high food prices. The projections are in the Macro-Fiscal Bulletin. The estimate for the increase in Gross Domestic Product (GDP) was maintained at 3.2%, in relation to the bulletin released in November last year. The GDP is the sum of all goods and services produced in the country.

Source: Jornal Contabil

Brazil reduces in 42% hiring of public servants

The Brazilian federal government has drastically reduced in recent years the hiring of federal civil servants, focusing instead on filling temporary vacancies. From 2016 to 2020, the number of workers entering the public sector declined by 42.11%, to 45,976 from 79,397, according to data collected by the Economy Ministry. The trend was intensified in 2020 because of the pandemic.

Source: Valor International

Project regulates exploitation of power plants at sea

A project of law, presented this week can start the regulatory framework for the exploration of energy on the Brazilian coast, whether it is wind, solar or tidal. It is PL 576/2021, which regulates the authorisation for the use of offshore energy potential, installed at sea. In Brazil, the main source of energy is hydroelectric. According to the proposal, the diversification of the energy matrix and the abandonment of a single source is fundamental to increase the energy security of the national electric system.

Source: Money Times

OECD projects higher growth for Brazil in 2021

The Organisation for Economic Co-operation and Development (OECD) today announced improved projections for the growth of the Brazilian economy this year and in 2022. At the same time it warned of risks in the event of persistent delays in covid-19 vaccination. The estimate is now for Brazil’s economy to grow 3.7% this year, or 1.1 percentage point more than the estimate made in December.

Source: Valor Investe

Market fears polarization after annulment of Lula’s convictions

The annulment of the convictions of former President Lula within the scope of Operation Car Wash, putting him back in the political game, has soured, once and for all, the mood in the market. On an already negative day for Brazilian assets, the decision by Justice Edson Fachin, of the Federal Supreme Court (STF), took investors by surprise and aggravated the search for protection against the risk of a new scenario of political polarization and additional doses of populist measures by the Bolsonaro administration. Benchmark stock index Ibovespa fell 3.98%.

Source: Valor International