The Redata regime could put Brazil in the global race for data centers and artificial intelligence

The new tax regime and its potential

Hélio Bruck Rotenberg, president of Positivo Tecnologia, believes that the Special Tax Regime for Data Center Services (Redata) could boost Brazil’s competitiveness in attracting investment in data center infrastructure and artificial intelligence. By reducing equipment costs for eligible projects, the regime creates conditions for expanding computing capacity and strengthening domestic server production. However, Rotenberg warns that the country needs to make progress in affordable energy, quality connectivity, legal security, and training of qualified professionals to consolidate this advantage.

How Redata works in practice

The legislation grants federal tax benefits for equipment intended for data centers that join the program. This measure reduces the tax burden on projects that depend on servers, while at the same time leaving room for Brazilian manufacturers to participate in the production chain. “When the national industry has the capacity to supply a particular model, local production will continue to be more competitive, and with fewer taxes under Redata,” notes Rotenberg.

“We see Redata as a huge and very timely step forward for Brazil. It improves the ability to compete for new investments in data centers and, at the same time, creates conditions for this growth to also strengthen the technology industry installed in the country.”

The demand for computing capacity and the role of Positivo

The advancement of artificial intelligence has increased the need for infrastructure capable of processing large volumes of data, making data centers a central element for companies that develop and use AI models. Although Positivo Tecnologia does not operate data centers, it manufactures servers in Brazil and identifies a repressed demand in the market. Before the tax change, many companies were already studying capacity expansion, but the tax burden weighed on the decision. “Many data centers were studying capacity expansion and new investments. Clearly, the tax issue weighed on that decision. With Redata, this equation has become more favorable and I believe we will see movements in the very short term,” the executive said.

Local production of servers and the limits of the global supply chain

Manufacturing servers in Brazil does not mean producing all components locally. Technologies such as GPUs and processors remain concentrated in global supply chains. The national stage involves engineering, integration, assembly, configuration, testing, customization, and support. “Producing servers in Brazil does not mean manufacturing every component that exists inside them here. GPUs, processors, and other advanced technologies are produced by highly concentrated global supply chains,” explains Rotenberg. Redata recognizes this reality by allowing access to imported technologies and preserving the competitiveness of those who manufacture servers in the country.

“Redata was very successful in recognizing this reality. It allows access to technologies that are not yet produced in Brazil and preserves the competitiveness of those who manufacture servers in the country.”

Expected impact and pending challenges

The initial effect of Redata is expected to be felt mainly by private companies that already demand computing capacity. The expansion of infrastructure is also expected to benefit universities, scientific institutions, and innovation projects, as the law requires that enabled data centers make part of their capacity available to the Brazilian market and invest in research, development, and innovation linked to the incentivized equipment.

“The private sector will probably feel the impact first, but the gains could spread quickly. The trend is to expand the computing capacity available in Brazil and strengthen the industry that produces the infrastructure needed to sustain this growth.”

Despite the optimism, Rotenberg stresses that tax competitiveness alone does not solve all challenges. “To compete globally, the country needs to combine tax competitiveness with available and competitive energy, good connectivity, legal security, qualified professionals, and agility to put projects into operation,” he says.

Outlook for the coming years

The executive believes that the next five years could be very promising for data centers in Brazil and, consequently, for the server market. “If there are advances on these other fronts with the same determination, it will be possible to attract new investments and expand artificial intelligence infrastructure in the country,” he predicts.