Fellow Brazillian GOGers,

With the new insanely high IOF tax I need to know: If I use paypal to buy my good old games, will I still have to pay IOF? Or using paypal will actually prevent the goverment from legaly robbing me?

That is a very good question.

I think that it depends on how your Paypal account is funded.

In other words, if you are using an international credit card to make purchases then Paypal will forward the transaction to your credit card company and after the currency conversion you will be charged the IOF.

However the IOF charge will only appear in your credit card invoice.

The new IOF rate will only start at the end of April.

Take a look at this article:
http://jogos.uol.com.br/ultnot/multi/2011/03/28/aumenta-iof-comprar-jogos-exterior-fica-mais-caro.jhtm

What is a IOF tax? It's like VAT? Or it is something additional?

I forgot that, IOF only appear in credit card invoice, and government always will steal us.

I'm not very sure of what it is, but it is charged whenever we use a credit card to buy something somewhere out of Brazil.

Originally it was 0.38% of the value spent. Now it's more than 6%

It´s a tax that is used on credit operations, insurance acquisitions, currency exchanges, fixed or variable rate financial investments.

Some examples:

Buying stocks or bonds.
A bank gives you a loan.
You make purchases with your credit card.
You buy an insurance policy.
You make a currency exchange at a nearby exchange office.

Thanks everybody for replying.

If it depends on how it is funded, than how can I fund it in a way that prevents IOF robbery? Because only way to fund it that I know is through a credit card.

Ways to fund it depends on the country. I can send money from my bank account to my Paypal account - it takes a couple of days to arrive and I can only buy for those limited funds I send over, but on the other hand Paypal can't take money I don't explicitly send them.

Thanks for the info.

Actually, I decided to take the plunge and test it and see the results by the end of the month. I had a paypal account already, but didn't have my credit card associated to it. Also, I noted during the buy, that it wouldn't allow me to use whatever BRL were already in my account (there were none anyway) and charged directly my credit card.

On my account page it states that it payed in USD, but transferred BRL from my credit card.

So... I guess I'll learn the truth by the end of the month. But I'll let everyone here know the results. :D

Well let´s suppose that you sell some stuff in Ebay and someone sends you money.
That money goes into your Paypal balance. If you make some purchase that it is less or equal to your Paypal balance, then your credit card is not used and therefore no IOF is taxed.

Hum... got it. Too bad it isn't very practical. But thanks for the tip.

The way i see it is that we have until the end of this month to enjoy a discount of 4% on all our purchases abroad.

Then our greedy and merciless government will once more rob us.
As if we don´t pay enough taxes.
Almost 40% of our yearly income goes to them! ` _ ´
Ingrates!

Thanks for the info.
It seems to me it is a tax meant to slow economic progress. This kind of taxation encourage black economy.
On the bright side, this will decrease immigration because for sure I'll never move in Brasil with this kind of taxes... :P :))

Lol..you are right on both points.
Our government reasons that to stop inflation and to strengthen the dollar currency is by discouraging people from consuming. Therefore they diligently raise existent taxes or create new ones.