Bolsonaro Promises Pre-Election Tax Cuts in Brazil

Senator Flavio Bolsonaro, son of former President Jair Bolsonaro, who is preparing for the second round of the presidential election in Brazil, announced that they would re-implement the Perse tax incentive program for the events sector if they win the election.

Senator Flavio Bolsonaro, who is managing the election campaign of former President Jair Bolsonaro in Brazil, stated in a social media post that they would revive the Perse tax incentive program, which was established to mitigate the economic impacts of the COVID-19 pandemic. It is reported that in the final polls ahead of Sunday's second-round vote, Bolsonaro is trailing his rival, current President Luiz Inacio Lula da Silva, by a narrow margin.

Assessment: It is noted that the broad tax cuts, which stand out among Bolsonaro's election promises, conflict with the country's public finance goals and raise questions regarding the commitment to faster fiscal adjustment. The Perse program, which came into effect in 2021 and provided support to the tourism and events sectors, ended in April last year after Congress imposed a cap of 15 billion reais, or 2.99 billion dollars.