Tax on offshore gifts?

A very interesting development is under way at the Supreme Court. As our clients and partners know we have always advocated about the opportunity of setting up an international estate planning with the benefit of not having to pay ITCMD tax on offshore gifts. That is possible because of a loophole in the regulation and with a lot of cases lost by the estates revenue services makint it pretty secure until now.

Sao Paulo estate revenue service lodged an appeal against the judgment of the 6th Public Law Chamber of the São Paulo Court of Justice (TJ-SP) which recognized the right of the taxpayer not be compelled to collect the amount for the gift tax/inheritance tax (ITCMD) on the bequest of a property located in Treviso, Italy, and on the transfer of a sum of money foreign (Euro), both operations carried out in 2005.
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That must be a bad joke!

In the worst moment in for the last 15 years we are sure to be very far from good news. The last one is the hoax that Central Bank might loose it’s ministry status, which led Alexandre Tombini the Central Bank president to issue a statement that he would leave the job if that happens. Loosing the ministry status, the Central Bank president can be liable for his actions and prosecuted in first instance courts.

Several newspapers articles circulated the hoax that culminated in Tombini’s statement. Apparently our politicians think the countries problem is not big enough.

This is part of the reduction of 10 ministries announced by the government. The summary is that for 4 of those 10 ministries will loose their status but the budget will remain the same! The others are ministries that have the lowest budgets meaning that this cost reduction will have little impact. That must be a bad joke!

If we were on the rating agencies shoes we would already have downgraded the rating to junk a long time, what seems to be only a matter of time now.


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