Government predicts minimum wage of R$1,502 for 2025, an increase of 6.37% over the current value

[ad_1]

Target should be zero, says Gerson Camarotti when commenting on what to expect from the LDO The Budget Guidelines Law (LDO) project that will be presented this Monday will provide for a minimum wage of R$ 1,502 – an increase of 6.37% over the current R$1,412. The percentage follows the new rule for valuing the minimum wage, which takes into account the growth of the Gross Domestic Product (GDP) in addition to inflation for the period. The LDO project will also bring a goal of zero deficit for 2025, and no longer a surplus, as predicted until last year. The minimum wage projection can still be changed if, by the end of the year, inflation is higher or lower than expected. The LDO serves as a “guide” for preparing the 2025 Budget, but also sends signals to the market about how the government itself sees the economic horizon. Until now, the government worked with the expectation of a surplus of 0.5% of GDP in 2025. In other words, it would be possible to collect more than it spends. The number, however, would require a very large effort – which could create distrust in the market and even in the National Congress. The change in target also affects the following years, according to government interlocutors interviewed by the blog. For 2026, the government now forecasts a surplus of 0.25%, and 0.5% in 2027, until reaching 1% in 2028. READ MORE Government should reduce target and discard surplus for 2025 Public accounts: how analysts viewed it the prospect of changing the fiscal target in 2025 In search of an additional R$300 billion, the economic team already admits to reviewing objectives This projection is precisely one of the factors that impact the review of the previously predicted surplus. In addition to the minimum wage, the government’s political area also puts pressure on the economic area to make the fiscal target more flexible and, therefore, be able to spend more in the coming years. Given this, maintaining a surplus of 0.5% of GDP in 2025 would require a greater fiscal effort from the country – in other words, spending less on social policies and investments. Financial market raises growth forecast for the eighth time Difficulties in Congress The government is already facing difficulties this year in reaching zero deficit, as Congress resists approving new revenue measures – including the reburdening of municipalities and the delimitation of Perse (a program created during the pandemic for the events sector). For 2025, the intention to guarantee a surplus of 0.5% of GDP would require a series of additional measures. Members of the economic team themselves make a realistic assessment that there is no longer any political space to maintain the same pace of increase in federal revenue as last year. At least, as far as it depends on Congressional decisions. The perception in the government is that the initially projected goals were very bold, but reality is imposing itself. And, at this point in the championship, it would be better to maintain the credibility of a realistic goal than to work with predictions that will not be realized.

[ad_2]

Source link