IOF/Bonds - Currency Related Derivatives
Transactions? Rate Reduction
On June 13, 2013, Decree No. 8,027 (Decree 8,027/2013), dated June
12, 2013, was published on the Official Gazette, introducing a
relevant change on the Tax on Financial Transactions Regulations
(RIOF), approved by Decree No. 6,306, dated December 14, 2007
regarding the Tax on Securities Transactions (IOF/Bonds) levied
upon currency related derivatives transactions, established in
2011.
The measure, which was announced last night by the Ministry of
Finance Guido Mantega, has a purpose similar to the one that
prompted the recent change related to the tax levied upon foreign
exchange transactions (IOF/FX): to minimize the devaluation of the
Brazilian Real in relation to the American Dollar and,
consequently, the inflationary pressure.
Decree 8,027/2013 introduced Paragraph 15 on article 32-C of the
RIOF, establishing that, as of June 13, 2013, the IOF/Bonds rate
levied upon the adjusted notional value on the acquisition, sale or
maturity of derivatives contracted in Brazil that, individually,
result in the increase of the short position exposure or the
reduction of the long position exposure, is reduced to zero.
Prior to the new rule, the rate applicable to the mentioned
transactions was 1%. Other derivative transactions remain subject
to the zero percent rate.
The Decree 8,027/2013 shall enter into force on the date of its
publication, i.e. June 13, 2013.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
