Brazilian Finance Chief Steps Down to Run for São Paulo Governor

Fernando Haddad has stepped down from his role as Brazil's Finance Minister to pursue the governorship of São Paulo state. The move sets up a high-profile political battle against the current governor and positions Haddad as a potential successor to President Lula da Silva.

Fernando Haddad has officially stepped down from his position as Brazil’s Finance Minister to pursue the governorship of São Paulo state, according to an announcement published in the country’s official gazette on Friday.

The 80-year-old President Luiz Inácio Lula da Silva has named Dario Durigan, who previously served as the finance ministry’s executive secretary, as Haddad’s replacement.

Haddad, widely viewed as a potential successor to the aging president, announced his gubernatorial campaign on Thursday. The race will likely pit him against incumbent Governor Tarcísio de Freitas, a supporter of former far-right President Jair Bolsonaro who has indicated plans to seek reelection.

Speaking at a campaign event Thursday in São Bernardo do Campo, Haddad expressed confidence about his political ambitions. “I don’t run in elections to bargain, I run to win,” he stated. “Political victory is always possible: you just have to present yourself with integrity and a strong plan.”

Political analyst Paulo Henrique Cassimiro from Rio de Janeiro State University believes Haddad faces an uphill battle against de Freitas, who currently holds the lead in polling data. However, Cassimiro noted that the gubernatorial campaign will elevate Haddad’s national profile.

“Lula’s Workers’ Party is really counting on him, including for Lula’s succession,” Cassimiro explained. “Even if he loses, running brings a very large amount of political capital, raises the person’s profile and makes the candidate’s name more widely known.”

Should President Lula win reelection—he declared his candidacy last October—Haddad could potentially return to his finance minister role, according to Cassimiro’s analysis.

Current polling shows a tight race between Lula and Flávio Bolsonaro, the former president’s oldest son who has also announced presidential ambitions, in a potential head-to-head matchup.

During Thursday’s São Paulo event, President Lula characterized Brazil’s current political climate as deeply troubling. “If we don’t bring forward the best people we have in each city and each state, and if we don’t take up the fight to defend democracy, we run the risk, through inaction, of handing democracy back once again to the fascists,” the leftist leader warned.

Haddad’s 2018 presidential campaign came about because Lula was imprisoned at the time. Though Lula served 19 months in jail, the Supreme Court eventually overturned his convictions, clearing the path for his successful 2022 campaign against Bolsonaro. The former president is currently serving a 27-year sentence for coup attempt charges following his electoral loss.

During his tenure leading Brazil’s finance ministry, Haddad successfully implemented significant reforms to the nation’s taxation system for goods and services—changes that had been under consideration for decades. He also championed well-received income tax modifications.

However, his time as finance minister wasn’t without challenges. Social media users created viral memes in 2024 dubbing him ‘Taxad’—a play on words combining ‘tax’ with his last name—after implementing controversial tariffs on inexpensive international online purchases.

Economist Carla Beni from the Getulio Vargas Foundation identified managing the economic effects of Middle Eastern conflicts as a key challenge facing new Finance Minister Durigan.

The government recently implemented temporary federal tax cuts on diesel fuel as global energy costs continue climbing. Officials plan to offset the resulting revenue loss through a 12% tax on crude oil exports.

“A very intense war like the one we’re seeing in the Middle East is something quite complex for Durigan to manage,” Beni observed.