Brazil Viewed As Major Regional Player By Americans, Poll Suggests

by Mike Godfrey, Tax-News.com, Washington

12 February 2008

According to a poll conducted last month on behalf of public opinion monitoring firm, Angus Reid Global Monitor, Brazil is viewed as among the most influential countries in the Latin American region by its near neighbour, the United States.

The survey, conducted in the US last month, placed Brazil in second place with 23% of participants selecting it as the most prominent nation, just behind Venezuela (with 29% of the votes), and ahead of Mexico (18%), Cuba (3%) and Argentina (3%).

Columbia and Chile received 2% and 1% of the votes of those polled respectively, whilst Panama, Nicaragua, Peru and Costa Rica were viewed as powerful players in the region by less than 1% of participants, according to Angus Reid.

Commenting on the political leadership in Brazil, the firm announced that:

"Luiz Inacio Lula da Silva—a member of the Worker’s Party (PT)—won the October 2002 presidential election in Brazil with 61% of the vote in a run-off against Jose Serra of the Brazilian Party of Social Democracy (PSDB)."

"In October 2006, he earned a new four-year term, defeating PSDB candidate Geraldo Alckmin with 60.8% of the vote in the second round. Lula is ineligible for a third consecutive term in office."

The Brazilian President suffered an embarassing political defeat in December 2007, after his government failed to secure the votes needed to renew the CPMF financial transactions tax.

Despite negotiations with the opposition to secure an extension of the levy - which would have brought in an estimated US$22 billion in revenue next year - until 2011, the coalition government fell short of the 49 votes (out of 81) needed in the Senate for the tax to be renewed.

The 0.38% tax is imposed on various types of financial transactions, including cheques, transfers, and bank withdrawals, and revenue from it has traditionally been used by the government to fund spending on infrastructure and health projects.

It is not yet known whether the President will put the legislation before the Senate again this year.

Even if he does and is successful, however, observers suggest that this latest defeat is likely to put a significant dent in the government's finances, which may need to be patched with tax rises elsewhere, or spending cuts.

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