The National Congress promulgated today (20) Constitutional Amendment 135/24, which deals with the government’s fiscal package to cut spending. The amendment comes from the Proposed Amendment to the Constitution (PEC) 45/24 and made changes to mandatory revenues and extended the Untying of Union Revenues (DRU). The measures aim to improve the federal government’s fiscal balance.
Among the changes are those that enable changes to the public service salary ceiling, the rules for granting the Continuous Payment Benefit (BPC), the salary bonus, the minimum wage readjustment policy, rules with limits for the granting and expansion of tax benefits and limitation of the growth of expenses linked to the fiscal framework.
When promulgating the amendment, the president of the National Congress, Rodrigo Pacheco (PSD-MG) said that the objective of the change in the Constitution is to preserve fiscal cohesion, combining the legal regime for these expenses with the fiscal framework in force and the “global scenario in which Brazil is included.”
Approved by the National Congress in August last year, the framework establishes limits for the increase in Union expenses. “Fiscal responsibility has become consolidated as a national imperative, even in times of challenging economic scenarios, such as the present time”, he said Pacheco.
The senator also stated that the changes promoted during the process of processing the proposal in Chamber of Deputies and in the Senate resulted in a text that reflects the plurality of world views and “legitimate interests represented within the scope of the National Congress”.
“Exactly for this reason, any inflammatory and counterproductive attempt to characterize the constitutional amendment as a type of measure contrary to the social interest and the most vulnerable sections of the Brazilian population must be rejected,” he stated. “Quite the contrary, what was aimed for with the proposal and the adjustments promoted by the National Congress was more than simply reducing public spending, but improving it in qualitative terms, directing it in the most reliable and efficient way possible to those who receive it. needs it most”, he said.
PEC
THE approval of the PEC texton Thursday night (19), was part of the government’s effort to control the growth of mandatory expenses, such as personnel and social programs. The approved text changes the salary bonus under the PIS/Pasep Program, of up to one minimum wage, paid to workers who earned up to two minimum wages per month in the previous year.
The approved change determines that the value of the PIS/Pasep allowance will only be corrected by the INPC from 2026 onwards. The salary will be paid to workers who have received two minimum wages in the base year, which will be 2023, which is equivalent to R$ 2,640. The access salary will be reduced until it reaches one and a half minimum wages, which, in the government’s forecast, should occur in 2035.
Another change was in the rules of the Basic Education Maintenance Fund (Fundeb), which finances public education networks, from kindergarten to high school. The fund is financed by revenue from states and municipalities, but receives supplementation from the Union when entities do not reach the minimum amount per student per year.
The approved proposal limits the resources that must be allocated to full-time enrollment to up to 10% in 2025. For the following years, the rule established a minimum of 4% of Fundeb resources. This must occur until the full-time education goals established in the National Education Plan are achieved.
Regarding the Untying of Union Revenues, whose term would end in 2024, the PEC determines its extension until 2032, allowing the government to make budget execution more flexible up to a limit of 20% of all federal taxes linked by law to funds or expenses.
Government commitment
The government leader in the National Congress, senator Randolfe Rodrigues (PT-AP), celebrated the conclusion of the vote on the spending cut package. According to the parliamentarian, the measures show the government’s commitment to fiscal responsibility.
“Today we are delivering to Brazil an economy that will be at least R$60 billion, without embargoes on future measures. We started two very turbulent weeks, due to exchange rate instability, we are concluding a set of measures that were required by the country at this time”, he stated. “What is most important is that we are delivering on this government’s commitment to fiscal responsibility,” he added.
Earlier, the Minister of Finance, Fernando Haddad, said that the economy will be just over R$70 billionwith a difference “around R$1 billion” with Congress’s changes to the spending cut package.
According to the leader, the government intends to vote next year on the project that provides for exemption from Personal Income Tax (IRPF) for those earning up to R$5,000. If approved, the change will take effect from 2026.
The projects that deal with limiting public service super salaries and also changes to military retirement are also postponed for next year. “The issue of super salaries has not been abandoned, we will vote on this issue at the beginning of next year. The issue of the military was addressed, but there was no time to vote”, summarized Rodrigues.
Randolfe also said that the 2025 Annual Budget Law project should be voted on shortly after the return from parliamentary recess, between February 1st and 20th, after the election of the board of directors of the Chamber and the Senate. “We would like [a matéria] was voted on this year, but the rapporteur understood that there would not be enough time to adapt the changes that were approved in fiscal organization in recent days to next year’s budget”, he lamented. Earlier, the rapporteur of the matter, senator Angelo Coronel (PSD-BA), informed that his report will be appreciated “after the parliamentary recess”, as there is still a lack of consolidated information on the matter.
*Extended text at 4:11 pm
