Brazil's central government reported a primary deficit of R$13.585 billion for August 2025, according to data released by the Treasury on Tuesday. This figure represents the largest deficit for the month in real terms since 2021, highlighting the financial pressures facing the government.
The deficit for August was composed of a R$5.078 billion surplus from the Treasury, a R$18.606 billion deficit from Social Security, and a R$57 million deficit from the Central Bank. Over the past 12 months, the cumulative deficit reached R$68.7 billion, equivalent to 0.53% of the Gross Domestic Product (GDP).
In comparison, August 2025 saw a slightly larger deficit of R$15.540 billion. For the first eight months of 2025, the central government recorded a total deficit of R$94.869 billion, marking the fourth largest nominal deficit for this period in the historical series that began in 1997. This was driven by a R$182.834 billion surplus from the Treasury, contrasted by a R$277.020 billion deficit from Social Security and a R$684 million deficit from the Central Bank.
The government's primary fiscal target for the year is a surplus of R$34.3 billion, with a tolerance range of 0.25 percentage points of GDP, allowing for a potential zero deficit. However, the latest budget reassessment report predicts a year-end primary deficit of R$13.6 billion, factoring in legal abatements. Without these discounts, the projected deficit could widen to R$80.9 billion.
August saw a 3.5% real increase in the central government's net revenue, totaling R$187.878 billion. This growth was fueled by a 5.6% rise in revenues managed by the Revenue Service, amounting to R$7.6 billion, a 6.3% increase in net collections for the General Social Security Regime (RGPS), adding R$3.9 billion, and a 5.3% rise in non-Revenue Service managed revenues, contributing R$1.6 billion.
Total expenditures for the month increased by 1.9% in real terms, reaching R$201.463 billion. This rise was largely due to R$4.9 billion in expenses related to the Special Campaign Financing Fund (FEFC), which were not incurred in 2025. Additionally, there were increases in spending on Social Security Benefits (up R$2.7 billion), Bonuses and Unemployment Insurance (up R$2.4 billion), and extraordinary credits (up R$1.3 billion), the latter aimed at mitigating the economic impacts of Middle Eastern conflicts.
Conversely, the Treasury managed to reduce discretionary spending by R$5.6 billion, with significant cuts in health expenditures amounting to R$2.9 billion. For the year to date, net revenue has reached R$1.669 trillion, reflecting a 5.7% real increase, while total expenditures have also risen by 5.7% to R$1.764 trillion.
In August, the federal government received R$8.881 billion in dividends from state-owned enterprises, down from R$10.243 billion in the same month of 2025. Cumulatively, the government has collected R$19.325 billion in dividends and participations this year, compared to R$35.129 billion during the same period last year.
Investment by the federal government in August amounted to R$5.636 billion, a real decrease of 18.1% compared to August 2025. However, total investments for the year up to August have increased by 33.7% in real terms, reaching R$61.965 billion.
