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Brazil's Department of Federal Revenue Approves Land Border Duty Free Shops

03/21/2018 - 10h55

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JOANA CUNHA
FROM SÃO PAULO

Brazil's Department of Federal Revenue approved on Monday (the 19th) regulations that will allow for land border duty free shops, a decision that has already attracted the interest of several multinational companies.

This means that stores subjected to a special taxation regime - similar to the ones that exist in airports and ports - will be able to operate along Brazil's borders, selling tax-free items to international travelers.

Eduardo Knapp/Folhapress
Duty Free at Guarulhos Airport
Duty Free Shop at Guarulhos Airport

The president overseeing Duty Free Americas' Brazil operation, Carlos Rabat, has said that he and his team are looking into the market potential of the areas contemplated by such regulations.

The stores are to be built in twin cities with a foreign counterpart, in other words, in municipalities bordering towns that are situated in a neighboring country. There are approximately 30 such cities in Brazil, a third of which are in the state of Rio Grande do Sul.

When travelers make a purchase, they will have to present an ID card and their CPF card to the Department of Federal Revenue so that it can keep track of how much money was spent. Travelers will have a US$ 300 tax-free ceiling that will get renewed every 30 days. There are also limits when it comes to certain products, such as alcoholic beverages and cigarettes.

Brazil passed a bill in 2012 authorizing land border duty free shops, but only recently did it manage to approve the proper regulations needed for such shops to begin operating.

Translated by THOMAS MATHEWSON

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