Overview

• The audit court deemed it irregular to frame the Budget by aiming only at the lower bound of the fiscal band and directed the Executive to secure a primary result of zero.
• The government plans to file its appeal within the 15‑day window and says the suspensive effect means no additional contingency will be applied for now beyond the R$ 12.1 billion already in place.
• Finance Minister Fernando Haddad says the appeal will argue that the 2019 Orçamento impositivo makes most spending execution mandatory, limiting room to target above the floor.
• For 2025 the target is zero with a tolerance of deficit or surplus up to R$ 31 billion, the government projects a R$ 30.1 billion deficit, and reaching the midpoint would require roughly R$ 30 billion in extra revenue or cuts.
• The TCU warned that managers could face liability and fines if its guidance is ignored, and it said any modulation of the requirement would be assessed in the appeal.