Fin Min To Present Alternative To Payroll Relief Bill After Lula Veto

In the wake of President Luiz Inacio Lula da Silva vetoinga bill intended to extend payroll tax exemptions across a number of sectors, Finance Minister Fernando Haddad has stated the gov't will 'later present a set of measures to address the situation of the economic sectors affected by [the] bill veto' once he returns from the COP 28 summit in Dubai (running 30 Nov-12 Dec).

• Lula claimed that the bill would have been unconstitutional and gone against the public interest. Haddad today states that the gov'ts Q323 revenues have dropped 'in light of the economic slowdown', and that 'we have the challenge of erasing [the] deficit by cutting tax benefits'.
• Adds that 'We will keep pursuing [the] fiscal balance goal', and that 'We do not want to hurt companies, wel will correct tax distortions'. The legislation had intended to extend the payroll tax exemption across 17 sectors until 2027.
• Following the veto, the Congress can override the president's measure, but absolute majorities in the Chamber of Deputies and Senate would be required. Given the gov'ts lack of majority in either chamber,, the sizeable centrão bloc of non-aligned parties will hold the balance of power in any vote.