LatinNews Daily - 26 October 2023

* Brazil’s lower chamber of congress has approved a government-backed bill (PL 4173/23) which aims to create taxes for offshore and closed-end funds. The legislation was first announced by President Luiz Inácio Lula da Silva in August as a tax on the “super-rich”. The bill was passed by a vote count of 323 in favour and 119 against and will proceed to be reviewed in the senate. The federal deputy responsible for drafting the bill and overseeing its passage through the lower house, Pedro Paulo, affiliated with the centrist Partido Social Democrático (PSD), has estimated that the taxes could raise R$20bn (US$4bn) in government revenue next year. The funds would be taxed at a rate of 15% starting 2024, although Paulo had accepted proposals from other lawmakers to allow some tax exemptions. For example, closed-end funds for investment in real estate and agricultural supply chains with at least 100 shareholders would be exempt. The Lula government had originally proposed a minimum of 500 shareholders for a fund to be eligible for the tax exemption.

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