Congress Dominates 25% of the Budget and Restricts Planalto's Delivery Capacity

This editorial analysis joins a recent collection of strongly negative tones on the Clareza Capital portal, marked by discussions on the end of the cash-basis regime in Simples Nacional and overall economic deceleration with a rising Selic rate, constituting the fourth critical piece published on the country's institutional and fiscal imbalances in recent weeks. From the perspective of value tradition and corporate and sovereign margin of safety, this budgetary dispersion erodes the predictability that private capital demands to invest in Brazil. When the budget ceases to be a technical planning tool and becomes a political bargaining chip, the risk premium demanded by international and domestic markets tends to rise, punishing local assets and increasing the cost of credit.

The main risk of this new budgetary architecture lies in allocative inefficiency and vulnerability to future fiscal shocks. With a quarter of free expenses controlled by Parliament, parliamentary amendments and special funds gain traction at the expense of large-scale structuring investments, which require a systemic vision and administrative continuity. Historically, governments weakened in executing public policies resort to accounting artifices or raise the tax burden to maintain the nominal balance of accounts, a scenario that directly impacts the competitiveness of listed companies on the stock exchange and household disposable income, which already face a cost of living pressured by 4.44% inflation and a dollar quoted at R$ 5.20.

Looking toward the 30-, 90-, and 180-day horizons, economic scenarios demand constant monitoring of fiscal execution. In the short term of 30 days, the probability is high that the financial market will react with punctiform volatility to each deadlock in the release of amendments and the execution of the fiscal framework. In 90 days, the risk of additional contingencies increases if tax revenues do not keep pace with spending locked in by Congress. Over 180 days, the trend points toward structural cost increases.