Tax cooperation

Tax cooperation among countries aims at the facilitaiton of business activity, trade and investments by negotiating agreements to elilminate double taxation and prevent tax evasion on one hand, and at the exchage of information among tax authorities with a view to increase transparency and fight harmful practices, such as tax evasion, tax avoidance, and aggressive tax planning,  on the other. Brazil has adopted the main international conventions on tax cooperation and works in close collaboration with the Federal Revenue of Brazil in the main international forums on the subject, with the aim of keeping Brazil’s  status as ‘largely compliant’ with the best international practices in the area.

Global Forum on Transparency and Exchange of Information for Tax Purposes

The Global Forum of the Organization for Cooperation and Economic Development (OCED) is the leading international institution aimed at ensuring the implementation of international standards on transparency and the exchange of information for tax purposes. Participation in the body is open to all interested parties, including non OECD members.

The Global Forum seeks to implement standards of transparency and of exchange of information in the tax area, thus preventing non-observance of tax norms, such as taxes, contributions, fees, etc., or that persons and companies benefit from loopholes in fiscal regimes in other countries in order to commit illict acts.

All G20 countries, including Brazil, have adhered to the Global Forum, which today has 150 members in addition to observer countries. With regard to the fight against tax havens and harmful tax practices, in 2010 Brazil joined other countries promoting the correct implementation of the Global Forum standards on the ‘white list’.

The Multilateral Convention on Mutual Administrative Assistance in Tax Matters

The Convention, in effect in Brazil since 10.1.2016, authorizes the exchange of relevant tax information between Brazilian authorities and the authorities of more than 90 signatory countries to the Convention. Information can be exchanged at the request of interested countries or automatically.

 Brazil-U.S. FATCA Agreement

In 2015, the Brazilian National Congress approved an agreement signed in 204 between the Government of the Federative Republic of Brazil and the Government of the United States of America to Improve International Tax Compliance and to Implement the Foreign Account Tax Compliance Act (FATCA). The agreement authorizes reciprocal automatic financial information exchanges with that country.

FATCA came into force in the United States in 2015 and had an effect on Brazilian financial institutions from 2015. FATCA seeks to eliminate tax evasion by American individuals and businesses by collecting infomation on American accountholders/investors who transfer funds to financial institutions located in other countries. Foreign financial institutuions that do not comply with FACTA rules  will be taxed at 30 percent on amounts received from financial transactions  with the United States.

Agreements to Avoid Double Taxation (ADTs)

At present, 34 agreements to avoid double taxation (ADTs) are in force in Brazil.

Division at the the Ministry of Foreign Affairs responsible for tax cooperation issues:

Division of Financial and Tax Policy (DPFT)

Phone: +55 61 2030-8528

dpft@itamaraty.gov.