President Luiz Inácio Lula da Silva sanctioned the 2026 budget on Wednesday (14/1), vetoing about R$ 400 million in parliamentary amendments for breaching transparency rules. The decision, published in the Official Gazette, could spark tensions between the executive and legislative branches in an election year, with another R$ 11 billion to be reallocated or blocked. The budget totals R$ 6.54 trillion, including fiscal targets and boosts for social areas.
President Luiz Inácio Lula da Silva sanctioned the Annual Budget Law (LOA) for 2026 on January 14, vetoing approximately R$ 400 million in parliamentary amendments. The Planalto's justification is that these funds, inserted during congressional proceedings, violated Complementary Law No. 210/2024, which demands transparency in amendment execution. Specifically, the veto targeted RP2-type resources, meant for ministerial planning in health and education, but earmarked by lawmakers for local destinations like cities and hospitals—a move the government views as an attempt to revive the extinct 'secret budget' (RP9). Prior to the sanction, Civil House Minister Rui Costa indicated the need to cut about R$ 11 billion in approved amendments, exceeding the 2.5% inflation-adjusted limit agreed with the Supreme Federal Court (STF). With the veto, the effective amount for amendments drops to about R$ 50 billion from the projected R$ 61 billion, a 25% increase over 2025's R$ 48 billion. Budget rapporteur Deputy Isnaldo Bulhões (MDB-AL) included 7,180 amendments: 5,784 from deputies, 1,086 from senators, 248 from state caucuses, and 62 from committees. To enable this, cuts were made to social programs, including R$ 6.2 billion from Social Security, R$ 300 million from Gas Aid, and over R$ 500 million from Pé-de-Meia. The total budget is R$ 6.54 trillion, with a primary surplus target of R$ 34.2 billion and an expense growth cap of 2.5%. Priority areas receive R$ 271.3 billion for Health and R$ 233.7 billion for Education. Social programs include Bolsa Família with R$ 158.63 billion, Pé-de-Meia with R$ 11.47 billion, and Gás para Todos with over R$ 4.7 billion. The minimum wage rises to R$ 1,621. The LDO requires commitment of 65% of mandatory amendments (R$ 38 billion) by July, before elections. Congress will review the vetoes in February.
