Brasília – After five straight monthly deficits, Brazil’s federal, states and local governments swung back to a primary surplus in October. The surplus – revenue minus expenditure, not factoring in interest expenses – reached BRL 39.589 billion (USD 11.561 billion at current exchange rates), the Brazilian Central Bank reported this Monday (28).
It was the widest monthly primary surplus since the Central Bank began keeping records in December 2001. Last month’s result was driven by a program for regularization of non-stated assets held abroad, known as the Repatriation Law. Taxpayers were required to pay 15% Income Tax and a 15% fine, totaling 30% of inbound assets.
From January to October, Brazil posted a primary deficit of BRL 45.912 billion (USD 13.4 billion). The comparable period in 2015 saw a BRL 19.953 billion (USD 5.826 billion) deficit. “The program’s result was an important factor in the primary result, yet it did not turn around the trend of widening fiscal deficits we had detected throughout the year,” said the joint chief of the Central Bank’s Economic Department, Fernando Rocha.
*Translated by Gabriel Pomerancblum
