Brazil Tax Bill Collapses, Undermining Lula’s Fiscal Strategy

President Luiz Inacio Lula da Silva’s government failed to push a crucial revenue-raising measure through Congress on Wednesday, putting Brazil’s 2026 fiscal goal at risk and intensifying doubts about its ability to shore up public finances.

Despite multiple revisions meant to soften opposition, lower house lawmakers balked at holding a vote to ratify a provisional measure from Lula’s administration before its expiration at midnight.

Luiz Inacio Lula da Silva

Photographer: David Dee Delgado/Bloomberg

The plan was initially expected to generate 10.5 billion reais ($2 billion) in 2025 and 20.6 billion reais next year, before changes reduced its overall revenue projections. Its downfall is a setback for ...