A bill to exempt income tax on income up to R$5 should be sent to Congress this month, says the government leader.

BRASILIA (Reuters) - The government leader in the Chamber of Deputies, Representative José Guimarães (PT-CE), said on Tuesday that the government should send to Congress by the end of this month the bill that increases the income tax exemption for salaries up to R$5 per month, and that this will be the priority project for the first semester, along with the approval of the Budget.

"The government is considering the important agenda for the first half of the year, and there are two key points, amidst other issues already under consideration. From the government's perspective, we will make an effort to vote on the Budget by the 24th, and the Income Tax proposal, which should be sent to Congress in the coming days," Guimarães said in an interview with journalists.

The government leader participated this Tuesday in the first meeting of the new Minister of Institutional Relations, Gleisi Hoffmann, with a group of leaders from the allied base. Only the leaders of the PT, PSB, PDT, and PCdoB parties participated in this first meeting.

According to Guimarães, Gleisi will hold meetings with all allied leaders by the end of the week to rebuild the government's base in this second half of President Luiz Inácio Lula da Silva's term.

The congressman further added that the intention is to have the expanded income tax exemption bill approved by the end of the year, so that it can take effect in 2026.

Finance Minister Fernando Haddad stated that the proposal is ready. The calculation presented by the economic team predicts that the change to income tax would cost at least R$25 billion, which would be offset by a minimum tax for those earning above R$600 per year.