(MENAFN- The Rio Times) Wealthy Brazilians are quietly changing tax residency or moving assets offshore. The headline is migration; the story behind it is confidence.

After new rules tightened taxation of foreign assets, many high-earners didn't wait to see how the details would shake out. They hired lawyers, made plans-and some left.

Uruguay and Paraguay, with predictable regimes for newcomers, didn't have to advertise loudly. The offer-clarity, lighter taxation of foreign income, and long horizons-spoke for itself.

The scale isn't imaginary. Private-wealth trackers expect a larger millionaire outflow in 2025 than in 2024, and Brazil 's diaspora has climbed into the millions.

The loss is not only balance-sheet wealth. It's founders, early backers, and senior operators-the people who start firms, fund private credit, buy corporate properties, and put money into long-shot ideas.

That matters for ordinary Brazilians because small businesses are the country's engine. In 2024 they created about 1.22 million formal jobs-roughly seven in ten new positions.



Those firms need a healthy domestic savings base and investors willing to take risk. Yet the first half of 2025 saw net redemptions from risk-taking funds of roughly R$37.8 billion ($7.13 billion), and the foreign-exchange channel posted periods of net outflow-signs of thinner local risk appetite.

The result: costlier capital, shorter investment horizons, slower productivity gains. Brazil still has depth. Capital-market issuance in 2024 was strong-about R$783.4 billion ($147.81 billion), including R$473.7 billion ($89.39 billion) in debentures.

Pensions, banks, insurers, and retail investors continue to provide remarkable breadth. But depth is not the same as confidence. Depth can carry a market through a season; confidence keeps builders at home for a decade.

The fix is straightforward, not ideological: make rules clear, reduce surprises, and set long-term horizons that outlast electoral cycles.

Brazil doesn't need to be the lowest-tax option in the neighborhood. It needs to be the most reliable. When confidence returns, so do the people who turn savings into jobs.

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