The government and the opposition entered into a war of narratives due to the fall of the MP (Provisional Measure) that imposed a series of taxes on financial transactions.
The text lost its practical effect at midnight without being voted on by the National Congress.
Despite the efforts of the government members, the majority of the Chamber plenary voted to remove the text from the agenda on Wednesday night (8) and, thus, decreed it, to the public coffers in 2026.
Government officials claim that the opposition, once again, uses government revenue as a political weapon, citing the increase in spending on the eve of the last presidential election. They also claim that the MP would reduce tax distortions between rich and poor.
On the one hand, left-wing politicians see the potential to use this argument in defense of the government on social media. Including using the term “Congress, enemy of the people”. There are those who say that the government “won a speech”.
Allies of President Lula say that the fall of the MP could block up to R$10 billion in parliamentary amendments and harm resources for social programs.
The opposition, in turn, claims that the MP harmed the population by increasing taxes on investments. Some that would be taxed today are exempt from Income Tax. The group even nicknamed the MP “tax-everything”.
They also claim that the government managed to maintain part of the increase in the IOF (Financial Operations Tax) in the Supreme Court, so there would be no reason for the government to insist on increasing taxes through the MP.
Before the vote, party leaders warned that the center-right would not approve billions more for the Lula government to use in an election.
The articulation of right-wing chiefs also weighed heavily, in the opinion of parliamentarians. For example, they mention the governor of São Paulo, Tarcísio de Freitas, praised by , and criticized by the rapporteur of the matter, Carlos Zarattini (PT-SP).
The government made some concessions throughout the processing of the MP. President Lula himself entered the field and even dismissed ministers who are licensed deputies to inflate the base, but lost the battle against Centrão and the opposition in the Chamber.
Government members complained of alleged betrayal and dishonesty on the part of the Chamber’s benches, although they spared Hugo Motta (Republicanos-PB), president of the House. PP, União Brasil and the agricultural bench took a stance against the matter.
Lula’s allies began to consider defeat last Tuesday night (7), after the MP was approved with a margin of just one vote in the joint committee. Negotiations were not progressing.
At the same time, Centrão and the opposition had doubts about . Therefore, they chose to block the MP by removing it from the agenda, without voting on it point by point.
