Brazilians are flying to the U.S. to buy computers and then flying home. The cost savings on their purchases more than funds the trip. And some buy more than one, sell the second at home, making the whole thing ‘free’.
The tax on technology in Brazil is absolutely insane.
I had a friend from Brazil visit me in NYC recently. He flew here to buy a Macbook.
It was cheaper for him to buy a round-trip ticket to NYC, buy the laptop here, and fly back than it was to buy it in Brazil.
WTF? pic.twitter.com/QAresztSO9
— Nick St. Pierre (@nickfloats) July 12, 2023
In fact he could buy 2, and if not caught in customs, sell the second one in Brazil to pay his expenses
— Femisapien (@femisapien_z) July 13, 2023
It’s worthwhile even if you declare the purchases made abroad and pay tax on amounts over $1,000 because of the difference in rates.
The LAST thing you want to buy in Brazil is an Apple product. The prices are insane. The Apple Store in Rio De Janeiro is the emptiest one I've ever seen. This was 2 weeks ago. pic.twitter.com/tlwmM9hzMf
— Skylar DeRouen (@Skylarjderouen) July 12, 2023
This is being called out as the result of a tax on technology purchases. I’m not familiar enough with Brazilian taxation, but may also be the result of a prohibition on parallel imports which limits competition in imported technology goods.
People used to fly out of Venezuela to purchase basic household items like toilet paper, and purchase tickets they’d never fly in order to evade currency controls. Airlines benefited from poor governance, until that poor governance decided not to let airlines take the money out of the country. As civil order broke down, and most airlines ceased service, American Airlines continued their flights – sold only in non-local currency. By March 2019 they ceased that service in the face of pilot protests over safety concerns. And by May 2019 the Department of Transportation banned non-stop flights between the U.S. and Venezuela.
(HT: Marginal Revolution)
This is old news and shopping is by far the number one driver of Brazilian mass tourism to the USA. Many people expecting babies will fly to the US just to go to Buy Buy Baby and fly home with all the baby stuff – easily pays for the flight given the cost of this stuff in Brazil. This died down a bit as the Real fell against the USD and many US-Brazil flights were cancelled as a result but now that the Real has gained 20% on the USD this trade is back again in a huge way and you can’t easily find a seat between the US and many parts of Brazil even now in the off season. Delta just added JFK-GIG, but won’t start until October and AA not until December (which used to be year round).
Glad Mak came here to tell you this is old news. You’re about…eleventy years behind on reporting this trend.
This isn’t new. People have been flying to Miami from South America and packing suitcases full of everything from electronics to toothpaste and flying home for many years. That’s why every mall or shopping district has numerous luggage stores.
I’ve seen this. People at the Sawgrass Mall in Sunrise near the Panthers arena. Walking around with roller suitcases filling it with stuff and flying back to South America. Wild stuff.
That is why Brazilians are the biggest consumers at Orlando Premium Outlets.
How’s this for a fun take…
Brazil is a very popular plastic surgery destination for Americans. We should offer payment in the form of tech. Like …. “Boob Job: $4000 or 8 iPads”.
One of my cousins married a Bolivian woman. When her family comes to visit in the USA , it’s almost as much about the shopping as it is family time together.
Since when “he could” becomes “they are doing it”.
Since when does apple products equal to all laptops.
Gary, are you really running out of things to write about and now just push racist crap now?
Another post where I’m questioning how Gary is a travel ‘expert’. I’ve been flying into Latin America for years and going through customs there’s always plenty of people with piles of stuff they bought in the US to circumvent tariffs. Lots of US tourist destination luxury item sales are driven by people coming in from Latin America to skip the tariffs. I know some people where buying “gifts” in behalf of friends and family when you are going to the US is a social expectation.
Been going on for years. Wait until you have Brazilian friends and they know you’re coming. You become Santa’s courier.
This is not a new thing. People from every South American country come here and buy tons of stuff. Just go check out the check in counters at MIA, especially for foreign flag carriers from South America. You’ll see people lined up with mountains of luggage.
I lived in Argentina for a bit and whenever I’d travel friends from there gave me cash and asked me to buy the stuff. All the time.
Worth noting that while Brazilian duties and taxes are sky high, income taxes are very low by North American/European standards, generally from 7.5% (including self-employed people even if you are a high earner) to 27.5%, and property taxes are also very low. If you can make major purchases abroad, and earn income in Brazil you have beaten the system . . . and you get to live in Brazil as a large bonus. Of course, this doesn’t work for Americans, because the USA is practically alone in the world in taxing income its citizens earn outside the country (both Federal and State) and at some of the highest marginal tax rates in the world.
I’ve lived in Brazil for many years and find this taxation extremely prohibiting to the citizens of Brazil and their ability to increase GDP. Limiting access to technology via high import taxes in a false narrative to support local production / manufacturing makes no sense. We cannot compete with Asian markets and their low cost products in the tech arena.
What Brazilians need is access to technology so they can be more efficient, create, and bring value to their economy.
Don’t get me started on government corruption and waste of tax dollars collected…..
Lost my AirPods on a flight to Manus just two weeks ago. Was going to just pay the tax man until I saw AirPods Pro were $537 in Brazil vs $199 at Costco. I bought $30 knock offs to use until I returned home.
Venezuelans have been this since the Chavismo era. It’s totally expected now that the Brazilian Chavismo (Castrismo by Proxy with Lula) is back. Just today I have a friend flying back to Venezuela from Miami with 5 bags, and that’s because Copa didn’t let her check the 6th one.
It’s a funny thing that flights from South America land in Miami or Fort Lauderdale full of people with no or empty suitcases. But fly back at maximum takeoff weight because of this
@Dagan Brazil ran the experiment on whether a country – even one with massive domestic resources – can use protectionism to encourage the growth of domestic industry. The results are in, and it didn’t work. I actually prefer living under Brazil’s tax system to the USA’s more authoritarian system, but I have to admit that it has lead to massive distortion in the market, has been completely counterproductive, and has enriched wealthy and politically powerful interests at the expense of everybody else.
Americans are flocking to South America for cosmetic procedures and dentistry. I’m currently in Colombia for a month and a half.
Very old news! I worked for a computer manufacturer in the 90’s and the bulk of our Miami branch sales were to South American individuals flying home.
Alternate title: “I’ve never been to the check-in counters at MIA before.” Hehe 😀
But don’t these Brazilians buying computers in the USA end up with English, not Spanish, language systems? Maybe users can select languages other than English? I haven’t tried so I don’t know, it would make sense. But the English and Spanish keyboards are not the same.
@Doug Jensen Brazilians don’t speak Spanish.
Gary Leaf thanks for sharing this info. I travel to Brazil several times per year and hope to relocate there eventually. I had no idea the tariffs on electronics was that expensive.
I find it weird that so many know-it-alls felt the need to take time out of their lives to say “I already knew that.” Ok. For those pf us who didn’t know; we appreciate it. This comment section is a great example of what a weird place the internet is.
Also, the guy who posted about the income & property tax rates in Brazil; than you too sir!
The first mistake is buying a MacBook, why would you buy something that is overpriced regardless of the region with little to no extra benefit.
This is neither new nor unique to South America. Empresa Ecuatoriana de Aviación, In the late 70s / early 80s flew a B707 freighter in parallel with their passenger flight Miami-Quito. Just to carry the excess baggage.
Around the same era airlines offered fares from the Middle East to Europe, giving economy class out and first back with the higher baggage allowance on the return. This was a loophole in a highly regulated IATA environment.
@Mak: The reason only the US taxes global income is only the US maintains the global military to protect American interests abroad.
The problem is the corporations who mainly benefit from that protection have managed to push the costs for that onto individual taxpayers.
In the late ’80s, PAX from Central America would buy a table top microwave in the US to sell for a profit back home.
In the ’70s & ’80s, Russian diplomats and bureaucrats would fly home with loads of tennis shoes and blue jeans for a profit in supply constrained USSR.
Woodbury Outlet Mall north of NYC has shuttle buses packed with foreigners shopping for items to bring back home.
From what I’ve seen on YouTube, Canadians board jets in the US to avoid higher airfares north of the boarder.
And lets not forget when Americans would order prescriptions from Canadian pharmacies which were significantly cheaper.
Folks will always find a workaround to government roadblocks.
Now days we just call them “hacks”!!
People who travel to the USA just to buy apple products are complete newbies. You can get close to American prices in Brazil by buying stuff from people that imports from Paraguay… You can easily find people who do this on OLX (Brazilian equivalent of craigslist)
@Christopher Raehl
The reason only the US taxes global income is only the US maintains the global military to protect American interests abroad.
Sorry, but I never volunteered my labor for that foolish effort and never had any interest in paying for places like Germany, Italy, S. Korea, Japan, Spain, UK to get a free ride on their defense.
Look up the pictures from the 1994 Brazilian World Cup Champions flying back from the U.S. with piles of stuff including fridges. And they already made a ton of money playing in Europe. Going in for a few decades.