BRAZIL PUBLISHES NEW SHIPPING TAX REGULATIONS

BRAZIL PUBLISHES NEW SHIPPING TAX REGULATIONS    The Brazilian government has published regulations — Normative Act Nr. 8 — calling for a 25 percent tax on freight revenue, demurrage and container hire.
   Last year, the Brazilian government passed the tax, known as Medida Provisoria 1924-4, that would be applied to all remittances made from Brazil to companies situated in “fiscal paradises.”
   Brazil defines a fiscal paradise as any place that has an income tax rate of less than 20 percent. As many as 34 countries — mostly small island nations and territories — are affected, such as Panama, Marshall Islands, Bermuda, Mauritius and Malta.
   So far, there have been no reports of the tax being imposed on carriers and shippers.
   “Now that the rules have been published in the government record, it could be an indication that Brazil will try to collect the tax,” said Thomas Timlen of the Baltic and International Maritime Council, which represents hundreds of carriers and ship agents operating in Brazil. “Time will tell.”
   Companies located in countries that have signed tax avoidance treaties with Brazil are eligible for exemption. They include Argentina, Chile, Colombia, India, Russia and South Africa.