Budgetary

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Budgetary in Brazil can be complex and ever-changing. Let Brazilian attorneys guide you through Brazilian budgetary law procedure. They understand the articles of the Brazilian Fiscal Responsibility Law.

Budgetary Law Services

Our attorneys can help you when it comes to navigating budgetary laws and can assist you in several different areas. Some of the areas we can assist you in include:

  • Inquiries About the Tribunal Court of Audits
  • Relationships with Municipalities Involving Public Expenditure
  • Inquiries About the Application for Governmental Transfers to NGOs (Non-Governmental Organizations)

About the Brazilian Fiscal Responsibility Law

Enacted in May of the year 2000, Brazil’s Fiscal Responsibility Law (LRF) was designed in order to strengthen financial institutions and establish a broader framework of monetary planning, budget execution, and overall transparency. Such a law would be applied to the federal, the state, and the municipal levels of the system. Under the law, reports of financial standings are presented every four months, and the reports must include detailed accounts of how the budget was executed and how the executions complied with the provisions of the LRF.
One of the provisions of the LRF is that limits are set on employee spending. Including incomes and payments made to subcontractors, these limits are 50 percent of spending by the federal government and 60 percent of spending by the state and local government. If these limits are exceeded in any reported four-month time period, then the spending must be equalized in eight months.
For public debt, a limit at 120 percent of federal and state revenue exists. If that limit is exceeded, the debt must be rectified to less than 120 percent in a twelve month time period, and no financial borrowing is allowed until that occurs. A provision called the “golden rule” states that total borrowing cannot breach the amount of overall spending. Loans at any government level are not allowed.
Within the LRF exist two different escape clauses that suspend the limits set by to the amount of debt allowed. The first applies in cases of a government-declared state of siege or of national emergency. The second escape clause only applies in the case of recession, which is technically described as a rate of growth that is less than one percent of gross domestic product over a one-year period. In this case, the allotted time period for equalizing the breach of the debt limit is doubled, and two years are given. The suspension of limits offered by these clauses also applies to personnel spending. A few of the matters that the articles of the LRF address include:

  • Public Revenues/Expenditures
  • Tax Breaks
  • Debts
  • Credit Operations
  • Outstanding Commitments
  • Management of Public Assets
  • Transparency and Reports

About the Tribunal Court of Audits

The Tribunal Court of Audits in Brazil is known as the Tribunal de Contas daUniäo, or TCU. Created in 1891, it is the Brazilian federal accountability office, and is an arm of the Legislative Branch of the Brazilian government. The TCU assists Congress in exercising external audits over the Executive Branch, and its members are appointed by the National Congress and the President of Brazil. The TCU has in its employ highly-qualified civil servants who prevent, investigate and sanction corruption and misappropriation of public funds. In 2011 alone, the work executed by the TCU saved Brazilian taxpayers 14 billion reais (USD 7.44 billion).

Find Out More

Brazilian budgetary attorneys are here to help with any of the subjects addressed above and more. Their task is to assure you are in adherence to the law and instruct on the best course of action to take.

Phone: 212-300-7174

Email: info@oliveiralawyers.com