Exclusive-Brazil government to defend bill cutting tax breaks by 10%, says sources

BRASILIA (Reuters) -Brazil's government is expected to back a bill proposing a 10% cut to federal tax breaks as the main alternative to a controversial increase in the tax on financial transactions (IOF) proposed last month, two sources told Reuters on Thursday. The bill, which was proposed by lower house lawmaker Mauro Benevides, sets a 5% reduction in the value of tax benefits in 2025 and a further 5% cut in 2026, the proposal showed. Brazilian Finance Minister Fernando Haddad said earlier this week that the government would unveil a new set of fiscal measures next week aimed at balancing public accounts, with their approval seen as crucial to revisiting a controversial IOF tax hike.