Brazil to offer $2.5bn tax incentives for telco investments

Brazil's government plans to offer four billion Brazilian reais ($2.5 billion) in tax incentives to telecom sector companies over the next four years for expansion of communications infrastructure throughout the country, Communications Minister Paulo Bernardo said Tuesday.

Speaking to reporters after a meeting with Finance Minister Guido Mantega, Bernardo said the government would cut its PIS-COFINS tax for new investments in fiber optics and other broadband infrastructure.

The reduction will be available to all potential investors in the sector on the condition that they extend investments to the more remote North and Northeastern regions of the country and to cities that will host the 2014 World Cup soccer championship.

With the incentives, Bernardo said the government was projecting telecom sector investments of BRL70 billion in the next four years.

The minister said the government hoped to publish the measure via executive decree so as to put the incentives into effect before the end of the year.

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