Brazil Tax Exemption For Foreigners

Brazil has abolished the 15% capital gains tax on local government bond trading for foreign investors in a move to boost their holdings of local debt from $5 billion up to $10 billion over the next 12 months. The government is confident that the abolition of the tax, despite cutting revenues by around $100 million a year, will attract greater foreign investment into the local debt markets, allowing the government to extend maturities and lower interest rates, thereby reducing costs. The tax change is in line with other markets in the region such as Mexico and Argentina.