Brazil: Tax Hikes Breed Violence

Tax Hikes Breed Violence

The capital city of Brasilia erupted in riots last week as 5,000 demonstrators battled security forces, burned police cars and looted stores in the first outbreak of antigovernment violence since civilian rule was restored 18 months ago. The rioters were protesting President Jose Sarney's decision to increase taxes and prices on such items as cars, electricity, gasoline and cigarettes. The measures, announced just six days after last month's landslide election victory by Sarney's centerleft Brazilian Democratic Movement Party, were aimed at cooling off an overheating economy.

Finance Minister Dilson Funaro, stung by criticism of the economic-reform package that he helped shape,...

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