Fiscal Modernization of the Sao Paulo Public Sector

Project BRA/97/001 -- Start Year: 1997; Approved Budget: US$ 16,719,399; End Year: 2000; Implementing Agent: NEX (National Execution Related Projects); Executing Agent: Finance Secretariat of the State of Sao Paulo.

Project background and rationale:The State of Sao Paulo, the largest among Brazilian States in terms of GNP, suffers from chronic fiscal deficits, which reduce its ability to provide essential social services especially in its major urban centers. Within the framework of the Public Administration Quality and Productivity Programme launched in December 1995, the Government has embarked on an ambitious fiscal modernization programme, with comprises two major initiatives: the modernization of the Tax Administration Coordination (TAC), which is the body responsible for the administration of all State taxes, and the Modernization of the Internal Audit and of the Financial Administration.

Project development goal: This project aims to achieve fiscal balance by increasing public resource management effectiveness and modernizing State internal control and financial administration processes in order to liberate the resources necessary to strengthen the Government's performance in education, health and public security promotion.

Project immediate objectives and expected outputs: The project BRA/97/001 comprises two subprojects: a Tax subproject and a Financial subproject.

1. The Tax subproject aims to modernize the Sao Paulo Finance Secretariat's Tax Administration, through guidelines that promote the increase of income, better treasury-taxpayer relations, institutional reorganization and infrastructure adequacy. Moreover, it should allow the establishment of a results-oriented management and promote permanent human resource training and rewarding.

2. The Financial subproject aims at improving the Sao Paulo State budget, accounting and financial systems with the objective to provide the public administration with more efficient and effective tools to manage and control State resources.

Contact details: Projeto BRA/98/013 - Projeto de Modernização Fiscal do Estado do São Paulo, Secretaria da Fazenda do Estado de São Paulo, Rua Rangel Pestana, nº300, 6º andar, CEP: 01019-900 - Centro - São Paulo, SP