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Weekly Report - 03 July 2025 (WR-25-26)
BRAZIL: Government appeals to supreme court to restore tax hikes
The government of President Luiz Inácio Lula da Silva is challenging congress at the supreme court (STF) over a bill passed by lawmakers last week [WR-25-25] that suspended recently decreed tax hikes, such as increases to the financial operations tax (IOF). The case highlights rising tensions between the executive and legislative branches and indicates that the alliances of convenience between the left-of-centre Lula administration and the loose grouping of clientelistic right-of-centre parties known as the ‘centrão’ have broken down, without strong prospects for reconciliation anytime soon.
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