States should cut spending and restructure debt, says Fitch

                 

São Paulo - The risk rating agency Fitch said on Thursday that the Brazilian states require debt restructuring with the federal government before they can recover.

In the report, Fitch said the country's largest states can do more to improve tax collection and not see significant recovery until their costs are reduced and the debt to be restructured Union.

"We believe that most of the improvement in the collection of states is due to the strengthening of tax collection systems ... Since new higher rates have only recently been implemented, the increase in the collection is probably due to better collection and more efficient, "Fitch said in the report.