Reuters, 7/24/2012
BRASILIA, July 24 (Reuters) – Brazil’s federal tax revenues dropped more than expected in June from the same period a year before, as a stubborn economic slowdown hurts corporate profits and prompts the government to grant tax breaks to some industries.
Brazil’s federal government had tax revenues of 81.107 billion reais ($39.8 billion) in June, 6.55 percent less than in the same month in 2011 when adjusted for inflation, Brazil’s tax authority said on Tuesday.
The government was expected to collect 83 billion reais ($40.68 billion) in June, according to the median forecast of 5 analysts in a Reuters poll.
The drop in revenues may add to concerns on whether President Dilma Rousseff can meet fiscal targets while trying to stimulate the economy with a flurry of tax cuts, subsidized credit and more spending.
Brazil’s economy is expected to grow less than 2 percent in 2012, well below the 7.5 percent rate seen only two years ago, according to a Reuters survey of economists.
[...] picture remains murky. Some of the more negative aspects included falling job creation rates, decreasing federal tax revenues, dwindling consumer confidence, and a social security program plummeting deeper into the red. [...]