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IMF: Brazil should raise taxes

21 de julho de 2016

The country must increase tax levies in order to complement its fiscal reform, the International Monetary Fund advised in a report released this Thursday (21).

Brasília – Brazil should raise taxes to complement its fiscal reform, the International Monetary Fund (IMF) advised. In a report released this Thursday (21), the IMF said that the little room that the Central Bank has to bring down interest rates increased the need for the country to search for a balance in public accounts, both through spending cuts and a raise in taxes.

According to the report, raising taxes should complement the proposal to limit public spending sent to Congress last month. The IMF also advises Brazil to continue with structural reforms that allow the government to reduce compulsory spending, such as the social security system.

“In Brazil, there is limited room for monetary stimulus policies due to underlying inflationary pressures, and the fiscal consolidation should go on to reduce the large [public finance] deficits”, said the IMF.

*Translated by Sérgio Kakitani