Brazil compiles aid packages for states and cities | Instant News

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Chamber of Deputies of Brazil on Monday approved a BRL80 billion ($ 15.5 billion) financial aid package for city and state governments to make up for lost tax revenue during the coronavirus pandemic.

The lower house passed the bill with 431 votes to 70 and sent it to the Senate, where he could receive stiff opposition from parties in line with President Jair Bolsonaro’s administration.

Major Vítor Hugo, Bolsonaro’s ally in the lower house, opposed the bill, saying it would benefit states and cities that did not control spending during the crisis, according to the local financial newspaper Valor Econômico.

According to the bill that passes through the lower house, the state and city governments can receive funds from May to October this year, when tax revenues are expected to fall by 30%.

In addition, the bill delayed the payment of loans by state and city governments to the national development bank BNDES and the federal savings bank Caixa Econômica Federal. It also prevents the federal government from carrying out guarantees held by Banco do Brasil until the end of the year.

Earlier this month, BNDES announced a BRL40 billion credit limit to help up to 1.4 million small businesses pay their employees, while the Central Bank said it can buy up to BRL1 trillion of private sector assets to increase liquidity and increase credit availability for companies affected by COVID-19.

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