实现财政和环境可持续性的双重红利政策：巴西公共财政回顾（英）2025

aPublicfinancereview forbrazil DoubleDiviDenD Policies toachieve fiscal andenvironmentalsustainability aPublicfinancereviewforbrazil ConTenTs abbreviations5executivesummary7acknowledgments14introduction:16Chapter 1:macro-fiscal overview and fiscal sustainability challenges19Chapter 2:Policies to achievebrazil’s climate goals and commitments43Chapter 3:using fiscal policy to reduce emissions in transport, agriculture, and land use581. Taxing greenhouse gas emissions and other environmental externalities in fossil fuels602. Fiscal policies in agriculture753. Reform of the rural land tax81Chapter 4:leveraging intergovernmental fiscal transfers to reduce GhG emissions inbrazil87bibliography111annex 1:fiscalbackground114annex 2:overview oftaxexpenditures inbrazil118annex 3:application of theomega model tobrazil’secologicaltransformation Plan119annex 4:corefeatures of theomeGamodel121annex 5:brazilian subsidies for fossil and renewable energy sources123annex 6:total carbon price calculation125annex 7:internationalexperience withenvironmentalfiscaltransfers126 ABBReVIATIons exeCUTIVesUMMARy brazil’s necessary fiscal adjustmentwould benefit from policies that com-bine positive fiscal and environmentalimpacts.This is the key message of this re-port analyzing Brazil’s public finances under agreen perspective. Despite fiscal adjustmentefforts of recent years, Brazil’s fiscal challengeremains significant.over the past decade, thefiscal balance has deteriorated and public debtto GDP has steadily grown, nearing 80 per-cent. The large fiscal adjustment needed toreverse this trend requires structural changesto the Federal Government’s largest expendi-ture programs. A green approach to fiscal pol-icy offers opportunities to combine fiscal gainswith positive environmental impacts. Policiesoffering such a double dividend include pricingof greenhouse gas (GHG) emissions, throughan emissions trading system, and appropriatetaxation of fossil fuels.since much of Brazil’sGHG emissions and other environmental dam-ages derive from land use and agriculture, fiscalpolicies should incentivize sustainable practices,including in the taxation of rural land, while re-ducing inefficient public spending. Brazil’s inter-governmental fiscal framework, a complex setof transfers between the federal, state, and mu-nicipal governments, could also be leveraged tobetter align incentives across the federation tosupport national goals for emission reductionsand the preservation of natural assets. Persistentfiscal deficits combinedwith low growth have led to a steadyincrease inbrazil’s public debt-to-GdPratio, highlighting the need for fiscaladjustment.Following a period of strong fis-cal performance, Brazil has run primary fiscaldeficits almost every year since 2013 with thepublic debt-to-GDP ratio increasing by over 20percentage points. As debt levels rise, the re-sulting increase in interest payments createsan additional burden, requiring an ever higherprimary fiscal surplus to stabilize the debt ra-tio. Halting this dynamic, stabilizing debt andrebuilding fiscal buffers makes fiscal adjust-ment, a return to significant primary surplusesan urgent task. the main drivers of the increasingdebt-to-GdP ratio have been risingcurrentexpenditures,especially onsocialtransfers,mostly to brazil’srapidly growing number of elderly.Gov-ernment spending increased by 5.9 percentagepoints (p.p.) of GDP between 2013 and 2024,while revenues increased much less (3.1 p.p.),resulting in a deterioration in the fiscal balance.Average real GDP growth during this periodwas low (1.0 percent), providing little offset tothe increasing public debt. At the federal level,increased spending on pensions – both con-tributary and non-contributory – contributed the most (2.5 percent of GDP) to the expansionof expenditures, as both the number of retireesand the level of benefits have increased con-tinuously. Brazil successfully employed socialassistance programs to mitigate the social im-pacts of the CoVID-19 pandemic, but by 2024,expenditures on non-elderly social assistanceremained far above pre-CoVID levels, despite astrong recovery of the labor market. ment should come from the expenditure side.With changing demographics increasing pres-sure on old age-related programs, it is neces-sary to adjust pension program parameters tomanage and contain rising costs. This includesrevisiting the use of the monthly minimumwage as the floor for all pension benefits. broadeningbrazil’s tax base while ad-vancing green taxation would betteralign the country’s high tax burdenwith environmental objectives.Brazilis undertaking a fundamental and long-over-due reform of indirect taxes. While this reformis designed to be revenue neutral, it offers thepotential to enhance the efficiency of the taxsystem and also provide better price signalsthroughconsumption taxes on goods withnegativehealth and environmental effects,such as fossil fuels. Broadening tax bases byeliminating inefficient tax exp