LatinNews Daily - 10 January 2024

*The president of Brazil’s senate, Rodrigo Pacheco, has declared his intention to negotiate with Finance Minister Fernando Haddad over how to address a controversial decree signed by President Luiz Inácio Lula da Silva on 29 December. The decree ended the extension of payroll tax breaks for certain industries. Amid the government’s ongoing efforts to increase tax revenue, Lula vetoed a bill in November which would have extended tax breaks on payrolls for 17 sectors. In mid-December, lawmakers voted to overturn the presidential veto. Lula responded by using an executive decree (‘medida provisória’, MP) to bypass the legislature and immediately end the tax exemptions. Pacheco has been under pressure to challenge the MP and held a meeting with leading senators on 9 January to decide how to proceed. Following the meeting, he stated that he still wanted to discuss a “sustainable revenue solution” with Haddad. MPs are urgent temporary measures which can be passed into law if a congressional committee approves making the measure permanent. Pacheco indicated that he would aim to decide by the end of January whether he would resist the MP or work with Haddad to pass into law a watered-down version of the decree.