(Adds revenue estimates, background)
BRASILIA, Oct 5 (Reuters) - Brazil's Senate on Thursday approved greater discounts to taxpayers in a debt renegotiation program, depriving the cash-strapped government of about 3 billion reais ($952 million) in revenues this year in return for political support in Congress.
The program, known as Refis, offers incentives for taxpayers to repay overdue debts in monthly installments. The government had expected to raise 8.8 billion reais in revenues through the program in 2017, but Finance Minister Henrique Meirelles said the changes should lower estimates by about 3 billion reais.
Senators removed an excerpt granting pardon to churches and some education institutions from the final version of the provisional decree. President Michel Temer is expected to sign the measure into law. Taxpayers will have until Oct. 31 to join the program.
Scandal-plagued Temer has scrambled to maintain his fragmented coalition united around his administration despite record-low approval ratings and corruption accusations. Temer needs the support of two-thirds of lower house members to block new charges filed last month by prosecutors.
Congressmen, many of whom will personally benefit from the tax renegotiation program, made successive changes to the program arguing that recession-hit companies would shut their operations without a greater relief.
"Businesses will close if we don't allow them to pay their debts in installments, especially the small companies that generate jobs and income for the country," said Senator Ataídes Oliveira, from the Brazilian Social Democratic Party (PSDB).
Smaller revenues from the Refis program raise the likelihood of the government missing this year's revised budget target for primary deficit of 159 billion reais. ($1 = 3.1499 reais) (Reporting by Maria Carolina Marcello; Writing by Silvio Cascione; Editing by Lisa Shumaker)