Government of Lula Revises Trajectory of Accounts and Postpones Fiscal Adjustment to the Next President

For 2025, the target will be zero result, no longer 0.5%


The Lula government (PT) has proposed a revision in the trajectory of public accounts that, in practice, postpones the fiscal adjustment to the next president of the Republic.

DF - BRASILIA - 26/03/2024 - The President of the Republic, Luiz Inacio Lula da Silva, accompanied by the Minister of Finance, Fernando Haddad. Foto: Mateus Bonomi/AGIF - Mateus Bonomi/AGIF

The fiscal target will be zero for 2025, the same as this year, with a gradual increase until reaching 1% of GDP (Gross Domestic Product) in 2028.

The numbers indicate a relaxation compared to the promise made last year in the presentation of the new fiscal framework.

In addition to the worsening fiscal scenario, the Executive also reduced the speed of the fiscal adjustment. If before the additional effort was 0.5 percentage points per year, the improvement in the result will now be 0.25 points per year in 2026 and 2027.

After the zero deficit next year, the government forecasts a surplus of 0.25% of GDP in 2026 (R$ 33.1 billion), 0.50% of GDP in 2027 (R$ 70.7 billion), and 1% of GDP in 2028 (R$ 150.7 billion).

The government's intention to pursue a less ambitious target was revealed by Folha. The number appears in the 2025 Budget Guidelines Bill, presented this Monday (15).

Read the article in the original language