Political Bargaining

October 2007 | Risk Summary

The extension of the CPMF (a provisional tax on financial transactions) to 2011, is still being negotiated in the Senate, where centre-right opposition party, (PSDB) is pushing for larger tax relief in various areas, as well as an increase in spending on health. The bill has already been passed in the lower house of congress, and will need to be approved by year-end. The PSDB have called for reforms of the antiquated tax system which would include a reduction in taxes, and a decrease in government expenditure. The CPMF accounts for approximately BRL40bn annually, equivalent to approximately US$22bn, and is

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