Brazil's Finance Ministry Rethinks IOF Tax Hike After Backlash

Brazil's Ministry of Finance is reconsidering its recent decision to increase the IOF tax after immediate criticism from the Congress and financial market. The government initially announced changes to the IOF aimed at generating an additional R$20 billion in revenue for 2025. However, this decision was met with strong opposition, leading the Ministry to partially revoke the measures on the same day. According to Dario Durigan, the executive secretary of the Ministry of Finance, "If this IOF measure is altered, as it was on Thursday, it brings an adjustment in terms of how you execute the budget. We will carefully consider the alternatives." This reversal highlights the sensitivity surrounding tax policy in Brazil and the government's responsiveness to public and market pressure. The Ministry is now actively exploring alternative methods to achieve its revenue targets while minimizing disruption to the economy.