Happy Friday! Today, we talk about how frail the government’s coalition in Congress is. How interest rate cuts jolted the stock market. And more climate warnings.
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A three-chamber system?
On Thursday, Congress struck down 14 presidential vetoes. Three were particularly painful: two threatening the government’s ability to make ends meet next year and one that curtails indigenous land rights.
Payroll taxes. An overwhelming majority from both chambers voted to override a presidential veto preventing the extension of payroll tax exemptions for 17 economic sectors beyond this year. The benefit will be granted until the end of 2027 and will deprive the federal purse of BRL 9.4 billion (USD 1.94 billion) annually.
- This tax break allows companies in the selected sectors — which include construction, garment manufacturing, and IT — to pay only 1 to 4.5 percent of their gross revenues as payroll tax, instead of the standard rate of 20 percent of all salaries paid in a month.
- These tax breaks were enacted in 2011, supposedly to benefit the sectors...