International Tax Newsletter - January

Ministry regulates temporary visa for digital nomads in Brazil:

With the objective of stimulating the activities of “digital nomads” in Brazil, the National Immigration Council regulated the granting of temporary visas and residence permits to immigrants who, without an employment relationship in the country and making use of information technologies, can carry out the jobs for foreign employers.

The resolution was published on the official gazette on January 24 and it states that temporary visa must be requested at any Brazilian consular office abroad, with the presentation of the documents provided for in the resolution, such as health insurance valid in the national territory and proof of digital nomad status.

Brazil enters the discussion to be a member of the OECD:

The OECD Council decided to open discussions for the inclusion of Brazil, along with five other countries (Argentina, Peru, Romania, Bulgaria and Croatia), as a candidate for membership in the organization.

The next stage of the process, after the invitation letter, is the elaboration of individual evaluation scripts for each of the candidate countries, which must confirm their adherence to the values, vision and priorities of the organization, with emphasis on themes such as democracy, the right of State and the protection of human rights.

The Administrative Counsel of Tax Resources (CARF) publishes decision regarding the taxation of marketing and advertising services

The Brazilian Tax Authorities have decided that marketing, advertising, and publicity services can be subsumed under the concept of input, and therefore, capable of generating PIS and COFINS credits provided that the essentiality, relevance for the performance of the activity.

In this regard, the Directors highlighted that only taxpayers who provide services related to the area of ​​marketing and advertising, including brand and market development, using marketing services provided by third parties as an essential input to their own provision of services, will be able to determine and crediting of the PIS and COFINS credit under the non-cumulative regime.

Brazilian Ministry of Economy intend to apply a zero tax rate on foreign exchange by 2029 to enter the OECD.

Brazil has committed with the OECD to zero the Tax on Transactions (IOF) of foreign exchange transactions, as part of the country's effort to adapt to the entity's practices.

The Brazilian president, Jair Bolsonaro, approved the new exchange rate framework by Congress and sanctioned on December 30^th.

Free Trade Agreement (FTA) between Brazil and Chile enters into force.

The Brazil-Chile FTA signed on 2018, entered into force on January 25^th,

A free trade agreement is an international agreement to reduce barriers to imports and exports. Under this agreement, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.