Abstract To alleviate the effects of socioeconomic inequalities and of the fall in economic activity on vulnerable populations during the COVID-19 pandemic, many countries have implemented or expanded income distribution programs. Brazil, amid the political and economic 2020 crisis, exacerbated by the pandemic, established Emergency Aid (EA). This longitudinal ecological study aimed to analyze whether the availability of EA contributed to the reduction of morbidity and mortality due to COVID-19 in the Brazilian 5,570 municipalities, from March 2020 to December 2021. The theoretical model considered as control covariates socioeconomic, sociodemographic and morbidity characteristics and access to health services, including COVID-19 testing availability and vaccination. Classical variable selection methods were applied considering the theoretical model, culminating in the adjustment of Bayesian hierarchical models with the inclusion of spatial and temporal effects. First dose COVID-19 vaccine coverage and EA had a protective effect against hospitalization (RR = 0.982 and RR = 0.986) and mortality (RR = 0.978 and RR = 0.976) due to COVID-19 in Brazil, when controlled by socioeconomic variables, access to health services and spatial-temporal effects. The results highlight the important role of income transfer in morbidity and mortality due to the disease, however, the way in which EA was implemented in Brazil presented a series of problems, the main ones being discontinued payment of aid, reduction in values throughout the duration of the benefit, in addition to the use of public resources to pay people who did not meet the eligibility criteria. Such problems might not have happened if the federal government had maintained the registration structure of Bolsa Familia Program (BFP), which did not happen. Furthermore, vaccination was started late for several reasons, that is, its role in reducing morbidity and mortality could have been even greater if started as soon as it become available. Key messages • Even with planning and execution problems, income transfer and specific vaccination were important in reducing COVID-19 morbidity and mortality in Brazil during the COVID-19 pandemic. • Income transfer during the COVID-19 pandemic in Brazil was not done in the best way possible, due to discontinued payment, reduction in values and payment to not eligible people.