The Commission of Agriculture, Farming Supply and Rural Development approved, this Wednesday the exemption of Income Tax (IR) for foreign financial institutions which lend money to the national farming production directed to exportation. Such Exemption shall be applied on interests and commissions received by these loans, as per Act 7154/10, of Senate.

The object of the Project by reducing taxes burden on book, is the cost reduction from loans to Brazilian agriculturist.
The proposal amends the Act 9.481/97 which set forth the IR application in source on yield from beneficiary which is resident or established abroad. This Act already exempts from the IR payment the interests received by loans directed to exportation of agricultural products (but not the production).

Cost Reduction
The reporter judge, congressman Marcos Montes, recommended the proposal approval based on that, for practical purposes, the project reduces the obtaining cost of foreign funds to national farming.

“The commissions paid to Financial Intermediary established abroad are also subject to zero rate, in the event of a product directed to exportation. Therefore, the project is favorable to the agriculture interests”, explains him.

The project will be assessed by the commissions.