(Adds source comments, pension details and context)
By Alonso Soto
BRASILIA Oct 18 Brazil will not scrap an
exemption from taxes on agricultural commodity exports in the
world's largest sugar, coffee and soybean exporter as part of
its social welfare reform, a senior member of the economic team
told Reuters on Tuesday.
Eliminating the exemption, which cost the government 5.3
billion reais ($1.67 billion) in lost revenue last year, was
weighed as an option to reduce the widening pension deficit in a
reform the government plans to present to Congress in coming
"Our focus with the reform is on expenditures and not on
revenues," said the official who asked not to be named so as to
speak freely. "That issue is off the table."
The official said there is a near consensus within the
government on setting a minimum age of retirement of 65 years.
Brazil is one of only a handful of countries in the world
that does not have a minimum retirement age. Pension payments
depend on a formula that combines the age and the number of
The government is also confident that Congress will approve
without any changes its landmark constitutional amendment to cap
growth in public spending for 20 years, said the official.
Comments by President Michel Temer that the cap could be
eased in around six years if revenues bounce back had fueled
speculation of changes to the proposal, which received initial
approval in a first-round vote by the lower house last week.
The reform to cut benefits of one of the world's most
generous pension systems is key for the cap to work and to avoid
a full-blown fiscal crisis in coming years, experts say.
($1 = 3.1795 Brazilian reais)
(Reporting by Alonso Soto; Editing by Meredith Mazzilli)