Brazil's Senate approves fiscal plan with up to R$60bn impact in 2027

Brazil's Senate approved the main text of Lula's fiscal plan by 45 votes to 31 on Thursday.

The government says the measures could save or raise R$50 billion to R$60 billion in 2027.

The plan would cut tax benefits for businesses by a further 10%, bringing them to 20% below their original levels.

It would also let the government limit how companies use tax credits to pay taxes when extra spending controls are in force.

In those years, starting in 2027, spending growth would be capped at 2% above inflation, down from the current 2.5% limit.

The government says the measures are intended to help meet fiscal targets without changing them.

Senators are expected to vote on proposed changes on Tuesday, after which the bill goes to the Chamber of Deputies; the government wants the rules in place next year, before the 2027 budget vote.