The Ministry of Economy announced on Monday (16) a package of measures to minimize the effects of the new coronavirus. In conjunction with measures announced last week, the proposals will have an impact of R$ 147.3 billion ($34 billion).
Most measures have no impact on the Budget. "All of this is being done without fiscal space," said Minister Paulo Guedes (Economy). But other members of the economic team backtracked on this and said that two elements will have fiscal impact—the reinforcement of the Bolsa Família budget and the tax exemption for hospital equipment.
The package is an attempt by the government to breathe life into the economy as the country goes through the coronavirus crisis. The pandemic has already led the government to revise its GDP (Gross Domestic Product) growth forecast this year from 2.4% to 2.1%. The market forecasts captured by the Central Bank are at 1.68%
“We need to make a counterattack to mitigate the [coronavirus] economic impacts. The impacts can be serious,” Guedes said.
The government will also allow for more money to be withdrawn for measures that impact the most vulnerable segments of the population.
Translated by Kiratiana Freelon