Rio de Janeiro introduces duty-free shopping for tourists

While Brazil is in the process of simplifying its tax regime, which has led the country to review its VAT system, the state of Rio de Janeiro plans to attract tourists by offering them a tax exemption.

Whether it is the simplification of administrative procedures or the exemption of visas for a selection of nationalities, countries have long used these types of measures to attract tourists. Then there are tax-free purchases, which offer foreign visitors the possibility of receiving a refund of the equivalent amount of VAT on purchases made during their trip. It is a well-known, if somewhat annoying, scheme that affects, for example, non-European travelers making purchases within the European Union.

Meanwhile, EU citizens can benefit from duty-free shopping in other global destinations. When traveling to Japan, for example, they can take advantage of duty-free shopping at authorized stores. This is usually done after purchase, in a special area of ​​the store. And it can be very profitable, given that in Japan VAT is 20% (except for cultural goods and restaurants, which pay a 10% tax).

The Brazilian state of Rio de Janeiro has decided to do the same, according to Tourmag.com, a media specialized in travel agencies. This tax exemption, which will be implemented from 2025, will apply to purchases made by foreign travelers using a bank card that has not been issued within the Brazilian banking system. In-store purchases, such as clothing or souvenirs, will be eligible. However, your feijoada and other local delicacies, nor any other consumption in a hotel, restaurant or bar, will not be exempt from taxes. Additionally, only accredited stores and establishments will be able to refund sales tax to tourists.

This good news for travelers comes a year after the approval of a tax reform program, which included a simplification of taxes for Brazilians as well as the creation of a value-added tax. The objective of this tax exemption is, of course, to encourage foreign travelers to spend even more, in a context that is already positive for Rio, since the number of visitors to the state increased by 27% in 2024 (until the end of November 2024). , which represents 1.3 million travelers. Visitors from Argentina, Chile, the United States and France were the most numerous.