RIO DE JANEIRO, BRAZIL - The Brazilian government is expected to announce in the coming days the exemption of foreign investments in debt instruments of Brazilian companies from income tax.
In practice, this means that it will become cheaper for companies to obtain funds from foreign loans.
The measure is expected to encourage the capitalization of companies that have invested in privatizations in Brazil, such as road concessions.
"Private companies need cheap financing. In the past, when the government was the driving force [for investment], we gave foreign investors a tax exemption for buying [government-linked] bonds. Now that private investment . . .