BRASILIA – The Brazilian government could change its budget target for 2017 if tax revenues dash hopes of a strong recovery, Finance Minister Henrique Meirelles said on Monday.
Meirelles said the government is stepping up efforts to boost extraordinary revenues through asset sales and reiterated that policymakers remain committed to their goal for a primary deficit of 139 billion reais.
When asked whether the government could change the target, Meirelles said the matter was under analysis.
“At this moment, the goal that was announced, of (a deficit of) 139 billion reais, will be pursued. But we are monitoring all economic factors.”
“Let us wait and see the performance of tax revenues, we believe there may be a strong recovery,” he added at a news conference after meeting his British counterpart. “We will have to do what is best for transparency.”
The deficit in the 12 months through June reached 167.2 billion reais, equivalent to 2.62 percent of gross domestic product and well above the official target.
Policymakers have already frozen about 45 billion reais in federal spending and raised taxes on fuel as they scramble to meet the closely watched goal. Brazil lost its investment-grade rating in 2015 after missing fiscal targets for years.
Changes made by lawmakers to water down a tax debt relief program contributed to reduce tax revenues this year, Meirelles said. He added that the government is not working on any tax hikes at this moment.