BRASILIA Dec 27 The Brazilian government said
on Friday it will raise a tax on operations with debit cards and
travelers checks made abroad, in a move that will raise the
country's tax intake by 552 million reais ($234.65 million) per
Starting on Saturday, the government will hike the financial
operation tax, known as IOF, to 6.38 percent from 0.38 percent
on those operations.
A rapid increase in spending by Brazilians traveling abroad
over the last few years has helped widen the country's current
account deficit sharply. The higher taxes will also be charged
on the purchase of foreign currency abroad and operations
involving pre-paid cards outside Brazil.
The finance ministry said in a statement that the move aims
to stop consumers using one payment method over others because
of tax benefits.
Brazilians had been using travelers checks and debit cards
abroad instead of credit cards as transactions on them paid a
lower tax rate.
The ministry said the IOF tax charged on the purchase of
foreign currency in the Brazilian market remains unchanged.