Brazil has the largest economy in Latin America and the seventh largest in the world. Like many countries, Brazil has had up and downs in its economic growth. However, Brazil has been hit by both political turmoil and economic problems. This has forced the government to initiate innovative ways to create jobs and encourage business development. Flavio Maluf is the current president of Eucatex and a business executive with over three decades of experience. Read more about FlavioMaluf at Blog do Ronco
Flavio Maluf reports Brazil has notoriously high taxes for doing business in the country. With such high taxes, increases businesses operation expenses and discourages business development. Considering the need for economic stimulation, the government has initiated various programs designed to stimulate more business development and job growth in the hopes to improve economic growth.
Flavio Maluf has been a business executive with Eucatex since 1997. According to Flavio, the federal government of Brazil has passed laws that lessen some of the financial burdens on taxation in the country. Business is still required to pay taxes, however, the funds are managed in more fiscally responsible manner. Flavio Maluf reports on Fiscal Incentive Laws, which are designed to stimulate more job creation and business development. Under these fiscal incentive laws, the taxes that are paid are not simply pushed directly to the government. Instead, portions of the funds are funneled to fund various social programs. In the past 100% of the taxed funds would go directly to the federal government, and from where the funds were used however the federal government desired. Under the new laws not only are the funds distributed in a more economically strategic manner, the businesses can leverage the funding to save money off advertisements. The business has the freedom to take credit for funding some of the programs the funding was used for as a sponsor.
The Fiscal Incentive Laws don’t actually cut taxes, but at least now the funds are used in more efficient and fiscally responsible manner. Also, businesses can take credit for funding programs that benefit from the tax funding distribution, which allows businesses to save money on advertisement. There are also other tax-free areas in the country to encourage business to relocate to these regions to take advantage.