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Brazil central bank eases export financing rules, boosts real
December 4, 2012 / 12:55 PM / 5 years ago

Brazil central bank eases export financing rules, boosts real

SAO PAULO, Dec 4 (Reuters) - Brazil’s central bank on Tuesday eased export financing rules, in a move analysts said was designed to attract more dollars to the country and support the real.

The central bank narrowed the scope of a hefty tax levied on exporters who receive advance payment for the goods they sell abroad.

According to the new rules, Brazil will no longer tax export prepayment operations of up to five years, a central bank spokesperson said. Before, only prepayment operations of up to 360 days were exempt of the 6 percent financial tax known as IOF.

The real added to gains after the measure was unveiled in a central bank statement. It last traded 0.7 percent stronger at 2.1037 per dollar.

The announcement on Tuesday almost completely reverses the central bank’s March decision to tax export prepayments longer than 360 days. A member of the central bank board then said the move was aimed at averting excessive appreciation of the real.

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