UPDATE 1-Brazil government to offer cheap construction credit

Tue Oct 28, 2008 11:40am EDT
(Recasts, adds finance minister comments and context)
BRASILIA, Oct 28 (Reuters) - Brazil's Finance Minister Guido Mantega said on Tuesday the government may ease tax requirements for companies battered by the global financial crisis and will unveil cheap financing for the construction industry.
The government loans, to be announced on Wednesday, will help construction companies with working capital, Mantega said.
"It will be a credit line at a much lower cost," Mantega said at an event sponsored by the National Industry Confederation in Brasilia.
Brazil's government has adopted a slew of measures in recent weeks aimed at alleviating the impact of the global credit crunch in Latin America's largest economy.
These have included foreign exchange swap auctions, selling of dollars in the spot market and increasing credit lines to farm and construction industries.
Mantega also said the government was studying the possibility of temporarily extending the time Brazilian companies have to pay their taxes.
He said the government has concerns about the fiscal balance and is already vigilant of a possible reduction in government revenues, due to the economic slowdown.
(Reporting by Isabel Versiani, Writing by Ana Nicolaci da Costa, Editing by Walker Simon)