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The Brazilian Ministry of Defense (MoD) has approved the first 26 defense companies to benefit from tax incentives aimed at stimulating the defense industry.

Brazilian military display in 2010. Source:  Wikimedia Commons
Brazilian military display in 2010. Source: Wikimedia Commons

According to Janes the Special Tax Regime for the Defence Industry (RETID) aims to make Brazilian defence products more competitive against those made abroad. The long-term aim is to encourage the defense industry to become the main supplier of strategic defense solutions to the MoD and to help increase exports.

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Each company will receive tax exemptions ranging from 13-18%. According to the MoD, Brazil currently operates a defense trade deficit of around USD420 million, exporting defence-related goods and services worth BR1.5 billion (USD640 million) and importing BR2.5 billion.