Rio has a strong engineering talent pool, along with many other major capitals in Brazil
What Brazil doesn't have is a history of properly rewarding talent, which often causes it to migrate elsewhere. So it's definitely surprising when any sort of technological development happens in Brazil: it implies someone who stayed managed to get something done, most likely for much less than what that something is actually worth, while also being crushed by extremely high taxes that essentially doubles the cost of computer hardware.
I think people are missing the last few words -- cost of computing hardware
when I used to do ISP work I did a lot for LATAM. The joke was that you'd get better bandwidth for Brazil routing out of the country and through Miami than going across the country. The reason? crazy high tariffs on hardware.
No reason to base anything locally, and if you're not basing it locally then there isn't really much reason to stick around, either. Go to other hot markets like Zona America, Austin, CDMX, Miami, Los Angeles, etc. and make the big $$$.
I worked with 2 Brazilian engineers who were in country (and currently work with a 3rd now, based in Monteal) and they were very good but all said they had to get out of country to lock in the serious engineering roles.
I always find this funny. Brazilian taxes are nowhere near what I would say “high”. I pay about twice as much out of my compensation as I would pay in Brazil, and that would be as if I did zero tax optimisation back then.
Compared to many countries Brazil doesn't have such high taxes (I'd say that if you work remotely for a company outside of Brazil, you'll probably have much lower taxes compared to almost any other country -- working locally the difference isn't as big, but you have higher taxes in many other places).
What it really lacks is access to capital (which is the real "mojo" of the US compared to the rest of the world).
As a business owner: not so bad if you are a freelancing or just a few business partners providing some type of service, but terrible the moment you start considering employing other people.
The result is a nearly 100% tax on computers and consumer electronics.
One for you, one for the government.
And it's getting worse. Tariffs on computer hardware were raised only a few months ago.
Brazil relies heavily on indirect taxation, not income tax.
The average Brazilian effectively pays about *41.1%* of their gross income in taxes when all major taxes are included. (https://ibpt.org.br/brasileiro-trabalha-150-dias-por-ano-ape...)
They break it down as: roughly 15.2% from income-related taxes, 3.1% from property taxes, and *22.9% from consumption taxes*.
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And anyway, the real problem is that the burden of tax is way way higher for a brazilian than someone in the global north.
As a general rule, in Brazil only people who do qualified work can reach the (converted) 1000 USD threshold. People who spent years in university or trade school, and are either very good at their jobs or graduated in prestigious professions such as engineering, law or medicine.
Even if they were to pay no taxes, most 40-hour week professional programmers here would still earn, at the end of the day, less than a high-school diploma 20-hour worker in US. Let that sink in.
Now take into account that on average, out of those $1000, $400 becomes taxes: In practice, there are lots of qualified workers here who don't even make $8k/year after taxes...
And no, the lower living cost does NOT offset it. Imported/technology goods are disproportionately expensive relative to income since we receive in BRL but still pay the dollar price, if not higher, due to said consumption taxes.
It's nigh-impossible to have true disposable income that your average Joe or plain Jane can use to dedicate to homebrew their personal projects in Brazil. And when it happens, it tends to in software form, since software still is relatively cheap to make.
People whose income in the top 25% bracket here make less in dollars than US's bottom 25% bracket, simple as that.
This is, of course also true of many many countries, which is why you usually don't hear about the new cool tech from Nigeria, Brazil, Bangladesh, Congo, etc. The people who are qualified enough tend to leave the country for better conditions. Of course, I'm not saying it's impossible, but people get surprised, just as you can see in this thread.
The result is a nearly 100% tax on computers and consumer electronics. One for you, one for the government.
That 6% figure is just the Simples Nacional rate for micro-businesses making less than 35kUSD/year. The actual income tax tops out at 27.5% at middle class thresholds. On top of that Brazil stacks social security tax, payroll taxes and a yet more taxes embedded in every single purchase. If you calculate all of this you can figure out something like up to 70% of a brazilian's income can flow to the government.
You say swedish companies pay 70% taxes. Well, swedish citizens get excellent services and a generally functioning country in return. Brazilian citizens pay 70% taxes and they get... Brazil.
