Brazil President Jair Bolsonaro sent a message to Congress saying that his legislative priorities for the year are the tax reform, the autonomy of the central bank, Eletrobras privatisation, entry to the Organization for Economic Cooperation and Development (OECD), job creation and the enactment of a regulatory framework for public sanitation. Lawmakers returned from the Christmas break focusing on local elections in October, something that can hamper the passage of substantial laws this year.
Brazil federal government ended 2019 with a primary deficit of R$95.1 billion ($22.5 billion), the lowest fiscal loss in five years, the National Treasury reported. It was the sixth consecutive year that the government spending exceeded taxes and tax revenues. Only in 2014 the deficit in the Brazilian accounts managed to be lower than in 2019, when the accounts registered negative results of the order of R$23.5 billion.
The Bovespa rose as much as 0.8% to a record high of 119,342.140, while the real firmed about 0.2% to the dollar on Thursday after data showed a jump in federal tax collections to a five-year high in 2019, boosted by an increase in the corporate tax take. The data underpins optimism over the economy amid sweeping structural reforms and a rebound in economic growth.
Brazil’s state-run oil firm Petrobras has lost an appeal over R$9 billion ($2.14 billion) of disputed taxes, but it will “take the appropriate judicial measures in its defence,” the company said. The procedures refer to the collection of taxes on remittances sent abroad for the payment of freight contracts in the years 2011 and 2012.