Finance Minister Guido Mantega presented on Monday a package of tax measures aimed at stimulating Brazil's economy less than a month ahead of the presidential election.
We want to make Brazilian industry more competitive and reduce juridical insecurity, he said after meeting in Sao Paulo with representatives of the powerful CNI business confederation.
The changes include extending to all industries a reduction in the rate of tax on overseas profits from 34% to 26%. Until now, that benefit has been available only to firms in construction, services, food processing and the beverage sector.
Mantega also announced that a program providing subsidies to exporters of manufactured goods is to be made permanent, with the levels of support adjusted on an annual basis.
The tax breaks are part of a stimulus program adopted by President Dilma Rousseff as she seeks a second four-year term in the Oct. 5 balloting.
Brazil, Latin America's largest economy, is currently in a technical recession after two consecutive quarters of negative growth.
A report released Monday by the Organization for Economic Cooperation and Development said Brazil's economy would grow by just 0.30% this year as the world's largest economies recover at a slower rate than initially expected.
Brazil's GDP expanded by 7.5% in 2010, but the economy posted tepid growth of 2.7% in 2011 and just 1% in 2012 before rebounding with a gain of 2.3% in 2013.