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Brazil central government posts record January surplus
February 26, 2013 / 7:50 PM / 5 years ago

Brazil central government posts record January surplus

* Surplus totals 26.14 bln reais, 24 pct of annual goal

* Large surplus due to recovery in gov’t revenues

BRASILIA, Feb 26 (Reuters) - Brazil’s central government posted its biggest primary budget surplus for January on record due to a jump in revenues, official data showed on Tuesday, suggesting an improvement in the country’s fiscal accounts.

The central government had a primary surplus of 26.14 billion reais ($13.17 billion), which represents about 24 percent of its 2013 goal of 108.09 billion reais.

The large primary surplus - or revenues minus expenditures excluding debt interest payments - comes at a time when the government plans to give billions of dollars in extra tax breaks in a bid to add momentum to a feeble economic recovery. The central government’s primary surplus also includes central bank and social security results.

The central bank is scheduled to release the country’s overall primary surplus on Wednesday at 10:30 am (1330 GMT).

President Dilma Rousseff’s government has already said it will not meet its overall primary surplus goal this year so that it can increase investments and help the economy.

However, Treasury chief Arno Augustin said the central government’s large surplus shows the administration remains committed to the fiscal discipline that helped bring economic stability to a country marred by repeated crises.

“This was a very expressive result... because we had an important recovery in revenues last month,” Augustin told reporters in Brasilia.

The central government’s net revenue was 101.75 billion reais, up 7.3 percent from December. Expenditures dropped 4.2 percent to 75.6 billion reais in January versus December.

Last month Brazil’s tax collection jumped 6.59 percent to 116 billion reais, the third straight monthly increase.

Tax collection slowed sharply last year due to a weaker economy and a slew of tax breaks that cost the government tens of billions of dollars in tax income. Federal tax collection rose a meager 0.70 percent in 2012 versus 2011.

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