October 30, 2017 / 7:38 PM / a year ago

Brazil to delay salary hikes for public service, raise fund taxes

BRASILIA, Oct 30 (Reuters) - Brazil’s government will issue two provisional decrees to raise taxes on closed investment funds and postpone salary hikes for public servants, the Planning Ministry said on Monday.

The measures had been previously announced in August as part of efforts to meet next year’s budget target, but had yet to be enacted.

Brazil is targeting an annual primary budget deficit of 159 billion reais for 2017 and 2018.

The government expects to collect 6 billion reais ($1.82 billion) with higher taxation of closed investment funds and to save 4.4 billion reais by delaying salary hikes for the public service for one year, the Planning Ministry said in a statement.

Provisional decrees are effective immediately after being signed by the president but need to be confirmed by both houses of Congress within 120 days to be turned into permanent law.

$1 = 3.2878 reais Reporting by Marcela Ayres; Writing by Silvio Cascione; Editing by Sandra Maler

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