300 Brazilian tax agency officials step down

Over 300 Brazilian senior officials resigned from their positions over budget cuts to the country's tax and customs agency, one of the agency's unions said on Wednesday.

Brazil's government had previously promised to increase salaries for tax agency officials, the union said a pay bump for police had taken precedence.

The cuts to Brazil's tax agency, known as the "Receita Federal," were enshrined in the government's 2022 budget when it was approved by Congress on Tuesday night.

Alongside the cuts to the Receita Federal, the new budget allots 1.7 billion reais (€265 million, $300 million) to Brazil's police, one of President Jair Bolsonaro's key constituencies. 

Brazilian presidential elections will be held in late 2022, most likely over two rounds of voting.

Why did the tax agency officials step down?

In the wake of the budget approval at least 324 senior auditors stepped down from their positions, the Sindifisco union said in a statement. The officials will remain with the agency in other roles.

There may now be as many as 500 unfilled senior posts across Brazil, Sindifisco said.

The union said that the funds from budget cuts to the tax agency had been reallocated toward police.

"Adding insult to injury, the Receita Federal's own resources will be cut to satisfy the readjustments agreed with the police," the union said in its statement.

The union further denounced this as a "show of lack of respect towards tax administration."

What are the implications of the mass resignation?

The mass resignation of auditors could pose tax or customs issues for Brazil's government during the busy Christmas period.

Bolsonaro is currently slightly behind former President Luiz Inacio Lula da Silva, more commonly known as "Lula," in volatile opinion polls as Brazil faces fast-rising inflation. He has also been criticized for his handling of the coronavirus pandemic in the country.

sdi/msh (Reuters, Lusa)