After the National Congress overturned two decrees of President Luiz Inacio Lula da Silva that increased the rates of the Financial Operations Tax (IOF), PSOL decided, on Friday (27), to appeal to the Supreme Court (STF) to try to cancel the decision. The party, which is part of the government’s allied base, argues that the legislature has invaded a private competence of the executive branch by sustaining presidential decrees.
According to PSOL, the overthrow of the decree constitutes a violation of the constitutional principle of separation of powers. The acronym states that only the Presidency of the Republic can legislate on the subject and that, therefore, the congress has extrapolated its attributions. PSOL’s national president, Paula Coradi, also criticized the social impact of the decision, claiming that she harms the poorest population and benefits the richest in maintaining an unfair and regressive tax system.
The party’s action includes an injunction to support the Legislative Decree approved by Congress. The PSOL was the first to judicial the issue, even as sectors of the government still discussed the ways to follow after the legislature defeat. The IOF rise, initially announced on May 22, aimed to generate a collection of $ 61 billion in two years, being $ 20 billion in 2025 and $ 41 billion in 2026.
The congressional decision to bar the decrees was considered one of the largest recent defeats of the Lula administration. In the House of Representatives, the vote ended with 383 votes in favor of the overthrow and only 98 against. In the Senate, the measure was symbolically approved, revealing an articulation between the opposition and part of the governing base. The judicialization of the matter now further intensifies the mood between executive and legislative.
