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Serra, sliding in Brazil polls, hits Rousseff record

*Serra tries to reverse steep slide in polls

*Raises tone against Workers’ Party, Rousseff

*Online debate seen having little impact on vote

RIO DE JANEIRO, Aug 18 (Reuters) - Brazilian opposition candidate Jose Serra on Wednesday accused rival Dilma Rousseff of neglecting investment and economic reform but struggled to land the heavy blows that could help revive his fading chances of winning the presidential race.

The former Sao Paulo state governor went into Brazil’s first online presidential debate needing a sparkling performance hours after the third opinion poll in a week showed the ruling coalition’s Rousseff with a decisive lead and heading for a possible first round victory on Oct.3.

But he mostly held back from the risky, all-out attack on Rousseff that some analysts had predicted, underlining the difficulty he faces in running against the political heir of hugely popular President Luiz Inacio Lula da Silva.

Serra, aged 68, took a more aggressive tone against the ruling Workers’ Party, pointing out its involvement in corruption scandals and its stance against crucial economic reforms that put Brazil on the path to prosperity in the 1990s. He also said Rousseff, Lula’s former chief of staff, was lying at one point in the debate during an exchange over education policy.

He took Rousseff to task over the state’s heavy tax take and a lack of investment that economists say prevents Brazil from growing faster.

“Brazil has one of the highest tax burdens in the world among emerging and developing economies,” Serra said in one exchange, drawing attention to an area that economists say Brazil needs to reform in order to grow faster.

“Despite the high tax burden, we are one of the countries where the government invests least.”


Factbox on political risks in Brazil: [ID:nRISKBR]

Graphic of Ibope poll:

Graphic of TV campaign time:

Story on undecided rural voters: [nN18185210]



Rousseff, who appeared more relaxed than in the first televised debate two weeks ago, parried the issue by reminding voters that the Lula government’s tax cuts in response to the 2008 global financial crisis helped Brazil ride out the storm.

The 62-year-old, who would be Brazil’s first woman president, repeatedly trumpeted the achievements of Lula’s government, during which millions of Brazilians have been lifted out of poverty by an economic boom and social welfare programs.

“I’m honored to be part of a government that managed to take this country out of a process of paralysis,” she said in response to an online question from a voter.

The online format of the debate, which was shown live on social networking sites Facebook and Twitter, reflects the rapid growth of the Internet in Latin America’s largest country in recent years. Still, analysts said Wednesday’s debate was unlikely to have much impact as most voters who are still undecided are poorer and have limited Internet access.

Rousseff raced to her biggest lead yet on Tuesday as a new poll showed her 16 percentage points ahead of Serra. The Vox Populi poll showed her with 45 percent to Serra’s 29 percent.

It was the second of three polls in the past week showing her with more than the 50 percent needed for a first-round victory if abstentions and blank votes are excluded, as they are in the election.

Even though both Serra and Rousseff favor a strong government hand in the economy, neither is seen as breaking with mostly market-friendly policies that have ensured years of strong economic growth.