Brazil Budget Claims Leave Debt Interest Out

National Treasury data show deficits in 2023, 2024 and 2025, while President Lula and Senator Flávio Bolsonaro debated the budget on Sunday ahead of Brazil's 25 October presidential runoff. Lula's record of annual primary surpluses from 2003 through 2010 is documented, but the Treasury series also makes clear that a primary surplus excludes interest on public debt.

What the Budget Measure Counts

A primary balance compares revenue with spending before interest on public debt. A surplus, then, doesn't mean the overall budget was in the black, as the base figures show.

The Treasury's historical series, updated to July 2026, records central-government primary surpluses in every year from 2003 through 2010. Above the line, annual results ranged from R$39.1 billion, about US$7.7 billion, in 2003 to R$77.9 billion, about US$15.3 billion, in 2010. The below-the-line measure, based on changes in net debt using central bank data, also shows a surplus in each of those years.

The eight-year span's strongest surplus as a share of output came in 2004, at 2.5%. Its weakest arrived in 2009, when the global financial crisis cut the surplus to 1.2% of GDP. The average was about 2.1% of GDP above the line and about 2.2% below it.

Revista Fórum said Lula was the only president to record a primary surplus in each of the eight years of his first two terms, at roughly 2.5% to 3.0% of GDP. That range doesn't match the Treasury's central-government series, and Fórum's article doesn't identify which measure it used.

The Deficits in Lula's Current Term

The Treasury records a central-government deficit of R$228.5 billion, about US$45.0 billion, in 2023, equal to 2.1% of GDP. Agência Lupa noted that the government paid R$92.4 billion, about US$18.2 billion, in court-ordered debts known as precatórios that December.

The series shows deficits of R$42.9 billion, about US$8.4 billion, in 2024 and R$61.7 billion, about US$12.1 billion, in 2025, equal to 0.4% and 0.5% of GDP. Lupa cited R$47.6 billion, about US$9.4 billion, for 2024; the sources don't explain why that differs from the Treasury figure.

At the debate, Lula said Brazil was presenting a budget with a 0.1% surplus. Lupa rated the claim true for the R$18.6 billion, about US$3.7 billion, projected in the 2027 budget bill. It also noted that earlier targets of balance for 2024 and 2025 ended in deficits. The 2027 number is a projection, not a result.

Claims, Targets and the Runoff

Lula also said the previous government left a 2.8% deficit. Lupa rated that remark false, saying the 2022 central-government result was a surplus. Lupa put it at R$54.1 billion, about US$10.6 billion; the Treasury's above-the-line figure was R$46.4 billion, about US$9.1 billion. Lupa said delayed precatório payments under Jair Bolsonaro, Flávio Bolsonaro's father, helped produce the surplus.

The Treasury series records surpluses every year from 1998 to 2013, beginning under Fernando Henrique Cardoso and ending in 2014 with a R$23.5 billion, about US$4.6 billion, deficit during Dilma Rousseff's first term. The file starts in 1997 and doesn't include Cardoso's first two years in office.

Fórum said Lula's third term set records in 43 economic and social indicators, citing unemployment of 5.1% in December 2025, a 2025/26 grain-harvest forecast of 361.7 million tonnes, oil output of 4.6 million barrels a day in August 2026, and a wage bill of R$332.7 billion, about US$65.5 billion. Reporting didn't independently check those figures.

Ahead of the runoff, prediction-market displays put Flávio Bolsonaro at 78.7% and Lula at 21.5% on Polymarket at 12:59 a.m. ET on 19 October, with about US$187.8 million traded in the election event. Later displays showed Flávio at 79% and Lula at 22% on Polymarket, and Flávio at 79% and Lula at 21% on Kalshi, as of 7 a.m. ET. Those figures are bets, not polls or forecasts, and no official full-year 2026 result was available.