BRASILIA (Reuters) – Brazil’s Senate on Thursday authorized the extension of a payroll tax exemption for 17 financial sectors till December 2023, a measure seen as mandatory to save lots of jobs throughout a interval of stagnant progress attributable to the coronavirus pandemic.

The invoice has already handed the decrease chamber of Congress and advances to President Jair Bolsonaro to be signed into legislation.

Bolsonaro praised the approval. “If it had not handed, we might have mass unemployment.”

The president proposed the tax extension a month in the past, sacrificing authorities income to keep away from exacerbating double-digit unemployment.

The exemption covers lots of the most labor-intensive sectors, akin to civil development, textile and footwear producers, transportation and communications corporations. Many companies had threatened layoffs if the exemptions, first granted in 2014, have been left to run out on the finish of 2021.

A file variety of Brazilians are out of the workforce utterly and the unemployment charge was 13.2% within the three months by August, in response to official knowledge.

Economic system Minister Paulo Guedes and his group, struggling to search out fiscal assets to keep away from deepening Brazil’s funds deficit, resisted the extension that’s estimated to price at the least 8 billion reais ($1.48 billion) yearly.