By Alfred Rinaldi, Contributing Reporter
RIO DE JANEIRO, BRAZIL - Residents of Brazil making purchases abroad using travelers' checks and pre-paid debit cards have been caught unawares by a surprise hike in the foreign transactions tax IOF. The Imposto sobre Operações de Crédito, Câmbio e Seguro (Tax on Credit, Exchange and Insurance Transactions) has been raised to 6.38 percent from 0.38 percent effective Saturday, December 28th.
Unlike other tax increases, which must be announced thirty days in advance by law, the Brazilian government is at liberty to alter the IOF-rate by decree with immediate . . .