Brazil Drops Insurance Guarantee Tax To Spur Projects

Law360, New York (August 16, 2012, 8:42 PM EDT) -- The Brazilian federal government on Thursday abolished the country's 7.4 percent financial operations tax on insurance guarantees for infrastructure projects, part of a package of measures unveiled this week to boost development.

Decree 7787, which drops the insurance guarantee tax — known by its Portuguese acronym, IOF — from 7.38 percent to zero, will save project developers approximately 60 million Brazilian reais ($29.7 million) annually, the Brazilian Economic Policy Secretariat estimated, based on 2011 numbers.

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