BRASÍLIA: In order to avoid further cuts in the Federal Budget this year due to a shortfall in federal tax collections, Michel Temer’s (PMDB) government has decided to include in the accounts a forecast of gains from repatriation of funds that today are being held illegally by Brazilians abroad. The decision is a reaction to a fall in tax income in August. The Treasury expects to collect at least R$ 8 billion (US$ 2.45 billion) in fines and payments of Income Taxes by Brazilians legalizing their funds.
The total amount could reach as much as R$50 billion (US$ 15.35 billion) according to calculations made by the economic team. This Thursday (the 22nd) the government will publish its bimonthly report which lays out the trends for federal income and expenses and how the government plans to reach its fiscal targets.
For this year, the target established for the primary deficit will be R$170.5 billion (US$ 52.3 billion). This will be the first time that the report has included a forecast for funds from repatriation. The expectation of financial market analysts and of the government is that the majority of these funds will be repatriated close to the end of the period, October 31st.
