BRAZILIAN CONGRESS VOTE THREATENS FISCAL PACKAGE.

Pensions & Investments, December, 1998 by Kepp, Michael

RIO DE JANEIRO -- Congress dealt the government a stinging defeat when it voted down two key social security tax proposals included in a recently outlined fiscal austerity package. More such congressional defeats could compromise both the fiscal package and the release of a substantial part of Brazil's $41.5 billion in International Monetary Fund emergency credit.

The Chamber of Deputies, the lower house of Congress, soundly defeated (205-187) the two proposals; a proposed increase, to 20% from 11%, in the social security tax paid by higher-paid civil servants on the part of their earnings that exceeds $1,000 per month; and a proposed 11% tax on social security payouts to retired civil servants, and a 20% tax on payouts to retired civil servants exceeding...

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