An article on Revista Exame this week sheds light on government data that showed that overseas purchases are increasingly common in Brazil with the accessible rate for the dollar against the real, noncompetitive industry in the country and transportation facilities. The magazine nailed it in the head defining in a few words what exactly happens and why. The high taxes built into the price of any product in Brazil make it very expensive to buy things in the country and those that can go out and buy outside, do. The ones that get hit the hardest are the poorest who cannot travel and have to buy and consume Brazilian prices.
The magazine says the government is concerned about what they call the “export of Brazilian consumers.” “There are people getting out of Brazil specifically to buy stuff for the baby in the United States. This is increasingly common,” said one source. I personally know people that have a decent job and that go to the US two or three times in a year to shop. They buy things for themselves, for the family and also to sell back in Brazil.
According to the article, the Central Bank said that the deficit on international travel in January was US$ 1.598 billion, a record number for the month of January. As consequence of that, The Ministry of Labour and Employment (MTE) have announced the closing of 67,458 jobs, also the worst result for the month since 1992.
Now, one thing is the government getting worried about it. Another thing is the government taking action to prevent that. In this case, that would be lowering taxes and the Brazilian cost. How about that?