The administration of Acting Brazilian President Michel Temer on Wednesday delivered a proposed constitutional amendment to Congress that would effectively cap federal government expenditures for the next 20 years. Under the proposal, increases in annual government spending would not be able to exceed previous-year inflation. The cap would remain in place for 20 years, with a revision of the mechanism possible after ten. Brazil’s government is grappling with crippling deficits that have exacerbated inflation while reducing the scope for government investments. Temer on Wednesday asked congressional leaders to pass the amendment this year in order to begin capping federal spending in 2017.
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