President Dilma Rousseff Asks Congress to Pass New Tax Bill to Reverse Recession

Brazilian President Dilma Rousseff addressed the congress for a call to approve a new tax bill on financial transactions to balance the country's finances and help reverse the recession later on.

Rousseff, who currently has a target on her back for impeachment by the lower house, asked for support for a new tax law called the CPMF. This is to be levied on every financial transaction, including purchases, withdrawals, and money transfers between individuals and companies to help increase revenue in the short term.

This appeal, according to Nasdaq, comes as Brazil faces one of its biggest crises in recent history, as it is expected to plummet 3 percent this year, after already contracting by 3.7 percent last year. Economists estimated that the central bank's inflation is now at 10.7 percent -- more than twice the official target that was set at 4.5 percent.

The Brazilian lawmakers are set to return from their annual recess and are faced with a long list of work to save their country from its current crisis. Reuters, however, thinks that there is little that they can do to make this year better than the last, especially considering that many of them are still arguing about whether or not Rousseff should be impeached so that they can start the whole reformation process from scratch.

However, it was also noted that Rousseff's CPMF will require months of political discussions with different committees, but may just be successful in generating revenues to begin helping Brazil's struggling economy.

As though the economic crisis is not enough for the struggling economy, The New York Times noted that Rousseff is also struggling with trying to deal with the Summer Olympic Games in Rio de Janeiro, which is coming up short on finances. The event is also on the lookout for the safety of athletes, considering the spread of the Zika Virus.

UBS Economists doubted the country's ability to get back up on its feet this year, saying that "The country has reached a point where stabilizing the debt dynamics -- which require reforms -- is critical for confidence to return. Yet, a reform agenda doesn't seem to be on the cards, given the government's limited political support in the Congress."

The lack of support comes from the impeachment proceedings against the president, with House Speaker Eduardo Cunha accusing Rousseff of using illegal accounting tactics to hide the actual state of finances in the last two years from the public. The process, however, could last months.

Rousseff, on her part, denied the said accusations.