Public accounts: government has a deficit of R$230.5 billion in 2023, according to Treasury

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Deficit occurs when expenses exceed revenues; value is higher than predicted in the Budget, up to R$ 228.1 billion. For 2024, the government continues to pursue a goal of zero deficit, that is, balance of accounts. The federal government recorded a primary deficit of R$230.5 billion in 2023, or 2.1% of the Gross Domestic Product (GDP), according to data released by the National Treasury Secretariat this Monday (29). It is the worst result since 2020. The primary deficit occurs when government spending exceeds tax revenue — interest payments on public debt are not considered in this case. Conversely, when revenues exceed expenses, there is a surplus. The value is above the 2023 Budget projection, which predicted a deficit of up to R$228.1 billion. It also exceeds the last projection, from November, which predicted a negative result of R$177.4 billion. The result is also above the government’s “informal target”. In January last year, the Minister of Finance, Fernando Haddad, had estimated that the negative result would be below R$100 billion, which represents 1% of the Gross Domestic Product (GDP). The institution responsible for making the consolidated calculation of the government’s accounts, which is considered to achieve the fiscal target, is the Central Bank. Unlike the Treasury, the BC has another methodology and does not consider resources that were not redeemed from the PIS/Pasep Fund as revenue, which could further increase the gap in the accounts in 2023. The data will be released in February. Causes According to the Treasury, the result was the impact of the payment of court orders – debt securities resulting from court decisions that the government can no longer appeal. In 2023, approximately R$92.4 billion were paid due to a decision by the Federal Supreme Court (STF), in November. The Supreme Court ordered the Union to pay off the debt with precatório accumulated in 2022, due to the “PEC dos Precatório”, which limited these expenses. Without considering the extraordinary payment of judicial debts, the government deficit in 2023 would be R$138.1 billion, according to the Treasury. This represents 1.27% of GDP. According to Treasury Secretary Rogério Ceron, the agreement for compensation by the Union to the states and the Federal District for the loss of revenue with the ICMS ceiling on fuels in 2022 also affected the primary result. it would be approximately R$117.2 billion, or 1.08% of GDP. “From that dialogue [déficit de 1% do PIB]towards the beginning of the year, we will be close”, stated Ceron. According to the secretary, the government considers that the fiscal result “was satisfactory in relation to the objectives that were set throughout the year, with all the challenges that were imposed “. Ceron adds others also had an impact on the result, in addition to ICMS compensation: court decisions, in particular the so-called “thesis of the century”, which removed the ICMS state tax from the PIS/Cofins calculation base; the Emergency Program for Resumption of the Events Sector (Perse), created during the pandemic; loss of revenue due to the drop in inflation. For 2024, the government continues with the goal of zeroing the deficit, seeking a balance between revenues and expenses. Government decides to maintain a target of zero deficit in public accounts in 2024

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