Nonsense: You'll pay 25% tax on hotels and tourism abroad

The Federal Official Gazette published today (26) the regulation of the expiry of the period of exemption on remittances abroad for the payment of tourism services, which entered into force on January 1, 2016. The amounts remitted began to incur Withholding Income Tax (IRRF) at the rate of 25% . The measure does not reach education and health.

According to the text, the measure reaches the amounts paid, credited, delivered, employed or remitted abroad, intended for the payment of services resulting from tourism, business, service, training or official missions. That is, it applies to expenses such as hotel expenses, transportation, lodging, sea cruises, and travel packages . The Revenue had already announced the change on the 20th.

According to the regulations, remittances for educational, scientific or cultural purposes abroad, as well as those for school fees, congress, conclave, seminar or similar fees and proficiency exam fees are not subject to withholding. IRRF.

In other words: When you book a hotel or purchase an air ticket, if you pay in foreign currency, a 25% tax will be charged.

Some exemptions

In addition, according to the text, remittances for the maintenance of dependents abroad are free, provided that this is not the income obtained by the favored. The exemption also occurs for remittances made by individuals residing in Brazil to cover medical and hospital expenses for health care abroad by the sender or his dependents.

According to the normative instruction, a tax rate lower than 15% of IRRF will be applied to income received by air and maritime shipping companies abroad, from individuals or legal entities, resident or domiciled in Brazil. The Brazilian Travel Agency Association (Abav) was waiting until last week for the government to give up and not adopt the rate. Abav said it expected taxation of 6.38%, not 25%.

Via TecMundo.