Brazil appeals to sovereign fund and state companies’ profits to meet 2012 fiscal target

Friday, January 4th 2013 - 23:40 UTC

Full article 9 comments

Mantega said that tax breaks meant 45bn Reais less for the Treasury last year

Brazil tapped into its sovereign wealth fund and state companies’ profits in an effort to meet its 2012 fiscal target.

The Treasury will withdraw 8.85 billion Reais (4.3 billion dollars) from its sovereign wealth fund and 4.7 billion Reais in dividends from state-owned bank Caixa Economica Federal, according to a Dec. 31 decision published in the official gazette.

President Dilma Rousseff administration last year cut taxes and stepped up public works spending as it struggled to revive an economy that the central bank estimates expanded by 1%.

Tax breaks reduced federal revenue by 45 billion Reais last year, according to Finance Minister Guido Mantega.

Brazil targeted in 2012 a budget primary surplus (before interest payments), of 139.8 billion Reais, about 3.1% of GDP.

In the first 11 months of the year, the primary surplus was 82.7 billion Reais, or 69% of the goal.

As part of the efforts to meet the goal, the Treasury is also authorized to discount 25.6 billion Reais in infrastructure spending from its target.

Categories: Economy, Brazil.

Tags: Brazil, Guido Mantega, sovereign fund.

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TipsyThink
WANTED !

I look aroúnd a mayhap British lady to marry.. opulence living in Sao Paolo(Santos weekends).

I believe It could be extremely luçrative lífe invéstment for her.
Jan 05th, 2013 - 10:24 am 0
Brasileiro
The Federal Tresure accumulate 17 billions of dollars in reserve in this year. So, this money can be contabilized in our “ativos orçamentários”. Why not?
Jan 05th, 2013 - 04:46 pm 0
ChrisR
@2 Brassiere

I have no idea what “contabilized” in our active budget. Why not?” means.

But I can tell you why not.

“Marvelous Mantega” could not run a piss-up in a brewery given his lamentable record to-date.

Anybody with half-a-brain could tell he was either lying through his teeth or totally incompetent when he announced that Brasil would hit the growth target. It ended up at less than +0.8% and given the fudge factor it was probably MINUS something. I predicted 1% maximum at the time.

Fiddling with the market as the government have done in the last 12 months NEVER works. The market (that is the people who buy things / or not) will decide what happens next AND it is not going to be pretty.

Robbing State Companies as he intends will leave them without money to safeguard the business when the real downturn comes which will be 2013 / 2014 + the way things look.

I am a fan of Dilma but she is making some decisions lately with her heart and not her head. She needs to replace Mantega with someone who does not lie to her and everyone else.

People who have accurate facts from their governments are more capable of deciding their fate than those who have been misled or lied to. The former understand what they are doing, the latter (who lose their money) hate the government when the truth outs.
Jan 05th, 2013 - 07:40 pm 0

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