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Doing Business in Brazil
Several municipalities offer tax and non-tax incentives in order to promote investments. In return for the tax relief, the beneficiary must offer investments, jobs and the development for the municipality.
- Services Tax (Imposto Sobre Serviços de Qualquer Natureza, or ISS) relief up to 3 percent, including third-party service providers. The ISS is a non-cumulative tax levied on the rendering of certain services set forth in Federal Complementary Law 116/2003, with rates that may vary from 5 percent to 2 percent;
- Exemption from ITBI (tax due on transfer of land ownership);
- Exemption from IPTU and TLF (Location and Operation Fee).
- The Government may also negotiate benefits beyond those provided by the current legislation. The incentives will assured to the company by the government, through a Memorandum of Understanding. Usually, the municipal administration may negotiate important concessions, such as:
- Grant or subsidized sale of government-owned land for industrial units;
- Infrastructure (access, road, speed bumps, electric power, and others).