Preconditions for Establishing Structural Fiscal Balances in Latin America and the Caribbean: The Case of Brazil

Levy, Paulo
Jul 2013
Fiscal policy has been at the center of Brazil's economic dynamics and performance for more than 30 years. In this line, the approval and implementation of a Fiscal Responsibility Law in 2000 was a key step in supporting fiscal sustainability and the transparency of fiscal accounts. Despite these improvements, removing the uncertainties and addressing the imbalances that still persist in fiscal policy-a long-term trend of rising expenditures and tax burden-will be a crucial step when considering further modifications to the current framework, especially regarding the introduction of a structural fiscal balance rule.