By Marcela Ayres

BRASILIA, Reuters – Brazil’s government may combine pandemic relief payments with “Bolsa Familia,” welfare programs to create a monthly stipend for 300 reais ($54.42), according to an Economy Ministry official who has direct knowledge.

Due to resistance by Congress to the proposed tax reform, that is what the government considers, said a source. He requested anonymity so as to not reveal sensitive policy issues.

Far-right President Jair Bolsonaro must ensure soon-to expire pandemic relief as he considers his declining re-election prospects in 2022 because of his decline in popularity after he handed COVID-19. A tight fiscal environment also limits his spending ability.

Paulo Guedes (Economy Minister) had planned to introduce a bill to address federal court-ordered federal debts. It would allow him to pay a new Auxilio Brasil stipend without going over the spending ceiling.

Additionally, he insisted that tax reform be approved. This bill allows dividends to be taxed in Brazil for first time. The bill passed through the lower chamber but the Senate has yet to discuss it.

Bolsonaro had earlier Monday stated that “God willing”, his government would resolve the issue by this week. He also said details about the extension to the emergency aid stipend.

Bolsa Familia recipients and vulnerable Brazilians are currently receiving emergency assistance in the amount of 150 to 375 reais each month. However, this will be the final installment.

It is vital that the stipend be extended to people who have been affected by inflation and are not protected from the coronavirus pandemic. The stipend can also be used to boost Bolsonaro’s popularity as we approach an election year.

This emergency assistance is intended to benefit more than 45,000,000 people. It’s a greater number than the 14 million Bolsa Familia beneficiaries.

($1 = 5.5123 reais)