And the Ministry of Economy announced this evening (22), the possibility of exceeding the ceiling of government emergency spending (a block) another 6.739 billion Brazilian riyals of non-compulsory spending from the general budget of the Union for 2022. According to the ministry, the decision is necessary because the expectations of mandatory spending by the Union increased Compared to previous forecasts, released in May.
The money ban was included in the bimonthly report on income and expenditure assessment, which was sent Friday night to the National Congress. The document is published every two months, and it guides the implementation of the budget. The distribution of the deductions by the organs of the federal executive branch will be disclosed in a presidential decree to be published by the end of the month.
According to the report, the need for a total ban for the 2022 budget increased from R$9.96 billion in the second quarter to R$12.736 billion in the third quarter. With the government still having R$5.997 billion blocked, the new block was valued at R$6.739 billion identified in the report.
The amount is lower than the amount reported earlier today by President Jair Bolsonaro. During a visit to a gas station in the morning, the president said the emergency could reach R$8 billion.
expenses
The forecast for primary expenditures in 2022 increased by R$ 45.819 billion, and the year is expected to end at R$ 1.834 trillion. The mandatory spending estimate rose to R$1.679 trillion, an increase of R$46,746 billion more than expected in May. However, the discretionary (non-compulsory) spending forecast by the executive branch was lowered by R$927 million, to R$154.246 billion. This resulted in a total variance of R$ 45.819 billion.
Details of the mandatory spending types with increased expectations will only be announced at a press conference on Monday (25). The Special Secretariat for Treasury and Budget at the Economy Ministry said the new figures include the overthrow of the veto of Paulo Gustavo’s law, which provides for cultural incentives totaling R$3.86 billion, and approval of a minimum wage for society. Health, which will have an impact of 2.24 billion R$.
Primary disability
The impact on public accounts will only be greater because, according to the Economy Ministry, total projected revenue jumped R$59.014 billion, even with exemptions granted on fuels and industrial products.
When deducting transfers to states and municipalities, the estimate of net revenue increased by R$51.955 billion. With revenues increasing at a faster pace than expenditures, the report lowered the initial deficit estimates for this year from R$ 65.490 billion to R$ 59.354 billion.
The Economy Ministry was told that the initial deficit projection includes approval of a constitutional amendment that increases social benefits and creates assistance for taxi and truck drivers. The change has an impact of R$41.25 billion through the end of the year, but these expenditures are not affected by the contingencies because they are outside the spending cap.
The estimate also includes an exemption of R$16.51 billion set by the supplemental law that eased federal taxes on gasoline and ethanol. Until the end of the year, these fuels will not pay a contribution to the Economic Intervention (Cide), a Social Integration Program (PIS) and a contribution to Social Security Financing (Cofins), in the same way as diesel. Valid since March of this year.
The primary deficit represents the negative outcome of government accounts before interest is paid on public debt. Official estimates are much more optimistic than the amount approved in the 2022 Budget Guidance Act, which sets an initial deficit target of R$170.474 billion for the central government (National Treasury, Social Security and Central Bank).
whole block
At the end of March, the government allocated R$1.722 billion in course modifications . In May, the economic team initially issued a ban worth R$ 8.239 billion, but The value was later reduced 6.965 billion Brazilian reals. From May to now, part of the funds have been released, but the government had to take a new emergency so as not to violate the spending cap, which led to a total freeze of 12.736 billion R$.
Every two months, the Ministry of Economy publishes the Income and Expenditure Assessment Report, a document that guides budget implementation. Based on expectations of economic growth, inflation, and the behavior of revenues and expenditures, the economic team determines the necessary blockades to achieve the goals of the primary deficit (a negative result of government accounts without interest on public debt) and the spending ceiling.
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