UPDATE 2-Brazil open to extra measures after new inflows tax

* Brazil open to additional measures to inflows tax

* Does not expect capital inflows tax to impact IPOs

(Adds comments from minister of trade and development)

BRASILIA, Oct 21 (Reuters) - Brazil's Finance Minister Guido Mantega said on Wednesday the government is considering additional measures to complement a new tax on capital inflows that went into effect on Tuesday.

The government said on Monday it would charge a 2 percent tax on foreign investment in Brazilian stocks and fixed-income securities in order to contain the rapid strengthening of the real BRBY. Additional steps might be necessary to enhance the impact of the tax in stemming excess capital inflows.

Mantega's remarks followed a Wednesday report by O Estado de S. Paulo that the government was considering deploying the sovereign wealth fund to buy dollars in local markets and mulling offering insurance for trade against excess fluctuations in the exchange rate. The report cited unnamed sources familiar with the situation.

"We just launched the measure, we have to see its repercussion. I think the repercussion will be positive and that we will reach the objectives established," Mantega said in Brasilia. "This does not prevent us from thinking of complementary, additional measures."

But Trade and Development Minister Miguel Jorge said on Wednesday the tax would only have a temporary effect on the currency and that the bigger impact would be on tax revenues, which many expect will rise as a result of the measure.

"I don't see this tax having a big impact in improving the conditions for exporters," he told reporters separately.

Critics of the new tax say it distorts pricing in financial assets and likely would thwart a nascent revival of bond and stock offerings in Latin America's largest economy.

Mantega sought to rebuff such criticism, saying the tax shouldn't impact initial public offerings in Brazil.

On Tuesday, BM&FBovespa Chief Executive Edemir Pinto told Reuters Brazil's largest exchange operator (BVMF3.SA) would propose the government change the 2 percent tax on capital inflows to ensure it does not discourage investment. See [ID:nN20209635]. (Reporting by Isabel Versiani; Writing by Ana Nicolaci da Costa, editing by W Simon and Guillermo Parra-Bernal )