Afropreneurship: Although racism is the principle obstacle for black entrepreneurs, Brazil’s tax system also puts them at a disadvantage

National research about the profile of Afro-entrepreneurs of Brazil

Note from BW of Brazil: In recent years, we’ve seen a lot of research and investment being devoted to “Afropreneurship”, referring to Afro-Brazilian entrepreneurs. And even though we’ve seen an upsurge in those who are participating in this entrepreneurial enterprise (some of whom have found surprising success) as well as those expressing interest in getting involved, we cannot ignore the hidden obstacles that impede or make the path to success for black entrepreneurs more difficult than for non-blacks. It would be great to believe that “we are all equal” or the market treats us all the same, but the facts prove otherwise, as the report below shows us. 



By Verônica Lima

Racism is the main obstacle to afro-entrepreneurship. But it’s not the only one: the Brazilian tax system also disadvantages blacks who want to start a small business. “Racism and Negritude” is the theme of this week’s Special Report. In the second chapter of five, get to know Rede Brasil Afroempreendedor, an association of black entrepreneurs, newly created and present in 12 Brazilian states.

Rio Grande do Sul state attorney Mariana Ferreira dos Santos, 28, specializes in real estate and is a partner of two companies: one in construction and real estate consultant and financial advisor. At the consulting firm, she and her brother, Daniel, 26, are innovating the real estate market with a solution that makes it easier to buy a home. With a differential: near the workplace.

It works like a collective purchase: a group of employees from a company hires Mariana’s consulting firm to negotiate with a large construction company, on behalf of clients, an entire apartment tower. Each will pay for theirs, but the bargaining power when negotiating 20 or 30 apartments is much greater than if each person were alone buying their property. Most importantly, real estate is always within a 5-kilometer radius of the buyers’ workplace. Mariana talks about the advantages of this for the worker:

“Even if you don’t have income, you are a person who uses public transportation, you will get stuck in traffic, so if you are a person who has money and has your own car, you will also get stuck in traffic. So, it affects the world.”

The proposal also benefits employers because the employee who lives nearby comes less tired and less stressed to work and therefore yields more. Not to mention that there are fewer cars and less traffic and pollution for the rest of the city. The project gave the young entrepreneurs participation in a selective process to win funding from the Inter-American Development Bank. The objective of this selective process is to favor the emergence, in Brazil, of the first millionaire companies owned by black people.

Now I ask: until now, had anyone here imagined Mariana and Daniel as young blacks?

Their competence should dispense with the description of skin color. But it doesn’t. Listen to Mariana’s account:

“As we work, sometimes with entire towers of incorporations, so 4, 5, 6, 7 million a tower and, always, the owner of one of the companies with which we are negotiating comes that says: ‘look, I’m still waiting for Mariana to come here to speak.’… One of the people said: ‘Mariana is the one sitting there, she was one of the first to arrive at the meeting.’ And he was appalled, didn’t participate in meeting, didn’t take our work with the least of seriousness. I don’t think it ever crossed his mind that a black woman was discussing the size and volume of resources.”

Afro-entrepreneurship – Development and racial equality: The path of the future

Mariana and Daniel’s companies are part of the Rede Brasil Afroempreendedor, a newly created black entrepreneurs’ association that is already present in 12 Brazilian states. I talked to Adilton de Paula, from the Adolpho Bauer Institute, who helped create the network. He told me that racism is still the main obstacle faced by black entrepreneurs in Brazil. The problem is so serious that it affects the self-esteem of these entrepreneurs:

“When this person goes to a bank to ask for a loan, when they are going to apply for a grant, when they are going to ask for accreditation of a project, they always look at him and say ‘no’ without often even analyzing the project in more depth, because the analysis is the analysis of the look: he’s black, it’s not going to work. As much as we hear people say this, it’s also introjected by the black population, who don’t see themselves as targeted and having conditions to dream big, think big and construct projects of great magnitude.”

The Brazilian tax system is also not favorable to Afro-entrepreneurs, who are mostly micro or small businesses without employees. Researcher Grazielle Custódio, from Inesc, Institute of Socioeconomic Studies, is the author of a study on the impact of the tax burden on gender and race. She explains how the current scenario favors large corporations, in general, owned by white men:

“The large corporations, especially the multinationals, are able, precisely because of their multinational nature, to carry out a series of maneuvers and make their profits always being considered in a country of a tax paradise. With this, it fails to pay the tribute within the country in which it should be paying. So the big one is not paying tribute, the small and medium are.”When this happens, we have a situation of extreme fiscal injustice, because we deregulate the capacity of competition in the market.”

Another injustice pointed out by the study is the fact that taxes focus more on consumption and not on inheritance. Deputy Reginaldo Lopes, from Minas Gerais, says who suffers the most from this:

“The poor pay more taxes because the final price of the product in consumption is already therein embedded in the price of the tax burden.He already buys the product with that tax burden transferred to him.The citizen who earns a million a month, arriving at the supermarket pays for a packet of rice the same price as the salaried worker or a family of the Bolsa Família.”

Distributing the population between women and men, and whites and blacks, and looking at the income of each group, researcher Grazielle Custódio of Inesc found the following picture: among the poorest are black women; and among the richest are the white men. The conclusion, therefore, is simple: if proportionately the poor pays more taxes and black women are the poorest, they pay more taxes in Brazil.

Report – Verônica Lima

Editing – Mauro Ceccherini

Production – Íris Cary, Cristiane Baker and Gabriela Pantazopoulos

Technical Works – Carlos Augusto de Paiva

Source:  Rádio Câmara


About Marques Travae 3747 Articles
Marques Travae. For more on the creator and editor of BLACK WOMEN OF BRAZIL, see the interview here.

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