The federal tax agency in Brazil have announced that any Brazilians holding unreported offshore assets located in Brazil will be eligible to declare the asset between April 4th and October 31st in exchange for a fine and no criminal proceedings in a government amnesty program.
The incentive is part of President Dilma Rousseff’s efforts to cut a growing nationwide deficit and recover the slowing investments in the economy. It will offer protection from criminal liability to Brazilians if they disclose undeclared foreign income back to the economy and pay a 30% similar to that of what should have been paid in tax.
When the bill was approved last year, the government in Brazil stated the incentive could raise up to 11 billion reais in revenue to close the growing deficit. The bill has its critics deeming it too lenient on tax evaders, who state it also enables money laundering originating from a corruption scandal on government bodies, where millions of reais were funnelled into legitimate accounts of ruling Politicians and Business Owners in Switzerland and other overseas tax havens.
Officials hope that new stricter legislation, coupled with growing international cooperation and the amnesty program will discourage future tax evaders.