Brazil's Rousseff under pressure to loosen austerity

miércoles 9 de septiembre de 2015 13:12 GYT

By Alonso Soto and Anthony Boadle

BRASILIA, Sept 9 (Reuters) - After months of trying to shore up Brazil's public finances, President Dilma Rousseff now faces political and business pressure to ease up on painful austerity measures in a country long hooked on the helping hand of a big state.

Business leaders have supported the beleaguered Rousseff as she faces growing calls from political foes for her resignation or impeachment, but some are growing impatient with austerity policies that are beginning to bite into their profits.

"The government's focus is completely wrong. It should be cutting its own payroll instead of investments that boost the economy," said Jose Carlos Martins, the head of Brazil's construction industry lobby.

Cutbacks in public infrastructure programs are expected to cost the construction industry 500,000 jobs this year, or about a sixth of its total workforce, he said.

As Brazil sinks into a deep recession, no one wants to bite the bullet, even if they know the government needs to spend less. It raises the risk that Brazil will lose its hard-won investment grade credit rating.

Rousseff's leftist Workers' Party and labor unions are calling on corporate Brazil to shoulder some of the burden before belt-tightening squeezes social programs that lifted millions from poverty.

"It was easy to give businesses indecent tax breaks. Now they don't want to start paying again," said Workers' Party Senator Paolo Paim, a steelworker turned politician. "We must get real and get tough on tax collection."

Manufacturing companies complain their payroll tax bill will double in some cases after the government recently rolled back tax breaks and reduced a refund of taxes on exported goods.   Continuación...