SAO PAULO/BRASILIA (Reuters) -Brazil’s Finance Minister Fernando Haddad confirmed on Tuesday that the government is conducting studies, at the request of President Luiz Inacio Lula da Silva, on a plan to eliminate public transportation fares nationwide.
Speaking on a government radio program, Haddad acknowledged the initiative, which surfaced in media reports last week and rattled markets amid concerns that Lula’s leftist administration could loosen fiscal discipline ahead of next year’s general elections.
According to the minister, the government is revisiting studies “to assess whether there are more appropriate ways to finance the sector.”
“We know that public transportation in Brazil, especially in urban areas, is a key issue for workers. At the president’s request, we are conducting a full assessment of the sector,” he added.
Haddad also said he expects Congress to vote on a government measure changing the taxation of investment income, expected to raise 20.9 billion reais ($3.93 billion) next year.
The measure, which faces resistance among lawmakers, was published by the government in June with immediate effect but must be approved by both houses of Congress by Wednesday to remain valid.
U.S. TARIFFS
Following a Monday call between Lula and U.S. President Donald Trump – and indications from both sides that they plan to meet in person soon – Haddad said the two leaders are determined to “turn the page” on recent tensions, referring to the ongoing tariff dispute between the countries.
Haddad said he believes Lula’s negotiation strategy with Washington will deliver the best outcome for Latin America’s largest economy.
The sooner the 50% tariffs on Brazilian goods are overcome, the better, he added, noting that ministerial-level discussions between the two countries are likely to take place before the leaders meet face to face.
“We may find time for another conversation with (U.S. Treasury Secretary) Scott Bessent, but I don’t know if that will happen,” Haddad said.
($1 = 5.3126 reais)
(Reporting by Isabel Teles in Sao Paulo and Marcela Ayres in Brasilia; Editing by Chizu Nomiyama )
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