Brazil's finance minister said Monday that the government will take tax incentive measures to encourage initial public offerings (IPOs) by small- and medium- sized businesses.
The measures included a tax exemption on capital gains for people who invest in the IPOs of companies with market value of 700 million reals (314 million U.S. dollars) through at least 2023, Guido Mantega said at an event in Sao Paulo.
Currently, the tax rate on capital gains from small- and medium- size firms is 15 percent, he said.
The government will also simplify the procedure for paying taxes on stock profits, he said.
These measures aim to boost "small and medium-size companies that have the inclination to grow, are efficient and productive, and want to aim higher, said Mantega.
The minister, however, said implementation of the measures was not immediate and that the government was uncertain if they would take effect this year.
Officials planned to establish a working group between the government, the Sao Paulo Stock Market and the Brazilian Securities Commission to simplify the tax payment rules, and to present its findings within 90 days, he said.
In addition, Mantega said the government will extend until 2020 a tax break for debtors in infrastructure, education, health and hydraulic or environmental projects.