If the economy continues to slow down due to interest rates, there will be ‘problems’ in tax collection, says Haddad

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Minister of Finance made the statement sitting next to the president of the Central Bank, Roberto Campos Neto, in a Senate debate on interest rates, inflation and economic growth. The Minister of Finance, Fernando Haddad, during a session of the Senate this Thursday (27) Reproduction/TV Senado The Minister of Finance, Fernando Haddad, said this Thursday (27) that if the Brazilian economy continues to slow down due to the high interest rates, there will be “fiscal problems” and impacts on federal revenue. Haddad made the statement during a debate session in the Senate on interest rates, inflation and economic growth – which was also attended by the president of the Central Bank, Roberto Campos Neto, and the Minister of Planning, Simone Tebet. “I don’t see fiscal, monetary and prudential policy as separate from each other. They are part of the same gear. If the economy continues to slow down, for reasons linked to monetary policy, we will have fiscal problems, because tax collection will be impacted. There is no way separate. If I slow down the economy, I will have fiscal impacts”, said Haddad. In the Senate session, Haddad sat next to Roberto Campos Neto. It is up to the Central Bank, through the Monetary Policy Committee (Copom), to set the economy’s basic interest rate (Selic), which is currently at 13.75% per year – the highest level in six years. High interest rates have been the reason for friction between the Lula government and its economic team and the Central Bank – an institution that has been criticized by government supporters. Fernando Haddad also said that the government inherited a country with serious problems in the economy and that it is taking “difficult measures” to compensate for what he called Jair Bolsonaro’s electoral “populism” last year. “It’s not easy to take unpopular measures, but they are measures that clean up the accounts and allow for a planning environment,” he said.

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