brazil report 2007

Any company properly registered under brazilian laws

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Unformatted text preview: s. Any company properly registered under Brazilian laws may acquire real estate essentially without any limitations. Despite a considerable list of bureaucratic requirements and complex tax and labour codes, normally no significant obstacles are encountered for running a business in Brazil. However, special attention must be given to those activities or situations in which some important environmental impact can be caused. In-depth assessment reports are normally required and months can be spent in the process of getting the permits. A property transfer tax of up to 6% is payable by the acquirer on sales or transfer of real estate. An annual real estate tax of 0.2% to 5% is levied on the assessed fair market value of the property. OTHER REGULATIONS Competition law and consumer protection The Administrative Council for Economic Defence (CADE), a government agency, is responsible for investigating and suppressing unfair business practices and anti-trust monitoring. The Antitrust Law (Law 8884/94) contains wide-ranging regulations in defence of free-market competition. There are specific agencies concerned with standards, quality and supply of foodstuffs, including imported products and regulations on weights and measures that must be observed by the consumer products sector. The Consumer Code Defence considerably strengthens the rights of customers. TAx AND VAT The Brazilian tax system is highly regulated and extremely complex. Different taxes/rates on the federal, states or municipalities levels have become a key theme in all sectors and for most companies that operate in Brazil. Despite no specific tax being additionally imposed in the retail and consumer sector in Brazil, the tax implications in the supply chain management are definitely crucial to determine the level of profitability and competitiveness for most of the companies. 5 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil The main direct and indirect taxes applicable in Brazil are: Corporate Income Tax Corporate income tax (IRPJ) is charged at the rate of 15% plus a surcharge of 10% on annual taxable income in excess of BRL240,000 (approximately USD109,000). Additionally, a social contribution tax on profits (CSSL) is applicable at the rate of 9%. Social Integration Programme Tax (PIS) and Social Contribution on Revenues (COFINS) PIS and COFINS (generally levied at 1.65% and 7.6%, respectively), are federal contributions calculated as a percentage of gross revenue. Newly enacted PIS/COFINS credit systems are meant to ensure that tax is applied only once on the final value of each transaction. As from May 1, 2004 the PIS/ COFINS contributions apply also on the imports of goods and on the payment of services to non-residents, while exports are exempt. Federal VAT (IPI) This federal valued-added tax is levied at varying rates around 10-15% on nearly all sales and transfers of products industrialized in or imported into Brazil. Exports are exempt. State VA...
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