BRASILIA, April 5 Brazil extended tax breaks to
new sectors and also reduced taxes on compensation to be paid to
electricity companies, according to a presidential decree
published in the official diary late on Thursday.
The decree changes the tax structure for infrastructure
construction firms and engineering firms, which will move to a
tax system based on 2 percent of gross revenue, as opposed to 20
percent of payrolls under the current structure.
Since last year, President Dilma Rousseff's government has
given tax breaks to dozens of industries, such as carmakers and
other durable goods manufacturers, in an effort to revive an
economy that is struggling to regain the red-hot growth rates
that made it an emerging market star.
News organizations, airport infrastructure companies and
port services companies will also benefit from the new tax
structure, the decree said.
Last year, Rousseff's government enacted legislation to cut
power rates by renegotiating the terms of electricity
concessions. Companies that declined to accept sharply-lower
government-mandated rates had the option of giving up their
concessions in exchange for compensation.
The government will also pay billions of dollars to
companies that signed new concession deals to compensate for
their previous investment. Under the terms of the decree, those
companies will not be subject to federal taxes on that
Last month, Trade and Industry Minister Fernando Pimentel
said Brazil's government plans to extend payroll tax exemptions
to all Brazilian manufacturing industries to boost investment
Representatives from Brazil's finance ministry declined to