The real question is, “is Brazil cheaper than your country of origin/last country of residence”?
Many expats and tourists come to Brazil thinking they´ll be able to bask in the tropical sun surrounded by tanned bodies, sipping caipirinhas and swaying in their pousada hammock for almost nothing. But once here, they realize those are the only things they´ll be able to do for nothing.
The Brazilian tourist industry is cruel with tourists, charging ridiculous prices for meals, internet access and all the things they are used to back home.
Brazil is expensive for the tourist, and very expensive for the people living here. As I wrote in my article “what is middle class in Brazil?”, the Brazilian is faced with an outrageous, gut wrenching tax load and gets absolutely nothing in return. So every family has to basically fend for themselves, in addition to paying Norway-style taxes, in relation to healthcare, schooling, transport and sports and leisure services (the only thing the government provides are wide open spaces, no real sports centres).
In fact, tax is such a large percentage of what everyone buys, that it´s not even displayed on the price tag or people would probably stop buying. In Brazil, you work 5 months a year to pay tax. By the age of 70, the average Brazilian will have worked 30 years just to pay tax. Brazilians pay around 61 different taxes.
Now let´s try to answer the question of this article.
The other day, I offered a ride to a woman and her son. In the car, she told me she had lived 10 years in the US and that she was seriously considering going back. The child looked miserable. I asked her why she was so bitter about her own country, and she said it had not advanced in 10 years, it was stuck in time, and that it was too expensive. She said she worked hard in the US, but got a lot more in return for all her work.
My sister lives in the US and always complains about the prices in Brazil when she visits. “In the US,” she says, “100 dollars lasts a long time.” “I spend a 100 reales in 30 minutes in Brazil.” My shopping cart is almost empty.”
I then wondered how I could compare prices in the US (just as an example, as we are almost in the same “continent”). I won´t include Europe as everything is simply too different. Medicine there is very cheap, healthcare is free and top quality for residents, transport is abundant and affordable, cars are 50% cheaper than in Brazil, education is reliable and salaries are 100% higher. So it would be unfair to compare a Latin American country with a country from the “old” continent.
I will compare everyday articles and some other items such as cars and computers.
Prices are all in USD. 1 US dollar is currently (June 2012) 2,00 Brazilian Reais.
Cornflakes (12 0z) US 3.85 (12 oz) Brazil 3,13 (240 grams)
Milk (Parmalat) US 2.94 (carton, fresh) Brazil 1,22 (carton, long life)
Lettuce (iceberg) US 3.75 (packet 7 oz) Brazil 1,00 (whole, unit)
Dove antiperspirant aerosol US 5.49 Brazil 4,45
Washing powder US (Tide, 700 grams) 8.69 Brazil (OMO, 1 kilo) 3,00
TV Sony Bravia C/KDL 40-inch US 1,199 Brazil 1.586
Motorola RAZR V3 US 64 Brazil 172,50
Ford Fusion 2006 V6 SE US max. 22,300 Brazil 42,000 (yes, double!)
1-bedroom furnished flat in the centre of São Paulo (50m2) 1.000/month
1-bedroom furnished flat in the centre of NY (60m2) 2,200/month
Fee English teacher US 30-100/hour Brazil 20-50/hour
Bank manager salary (without benefits) US 4,000 Brazil 2.000
Maid/house cleaner salary US 1,800/month Brazil 300/min. month
Getting a cavity filled at the dentist US 100-250 Brazil 20-50
A medium-quality sofa (chenille) US 615 Brazil 800
Sony Vaio VPC-EB15 US 815 Brazil 1.815
Looking at these prices, you can live a decent life in Brazil if you make more than 5.000 a month and don´t care about fancy cars and the latest electronics.
On the other hand, you will also need to pay for your child´s education from daycare to college, health insurance, unless you want to face the dreaded but sometimes kinder Public Health System (SUS) and all leisure-related costs.
Although life in Brazil may seem cheap or similar price-wise, there are lots of tweaks offered to consumers in the US or any European country that are simply non-existent in Brazil and most Latin American countries, such as good social services (as I insist on pointing out because it makes a HUGE difference), decent sales and offers (buy one get one free, something Brazilian have never heard of), and most importantly, good quality items. Brazilian furniture, for example, is very poor in quality unless you are willing to cough up more than 4000 reales for a sofa. A “designer” kitchen rack can cost as much as 200 USD, although a shaky, cheap version can cost around 20,00 USD, which would get you a decent rack in the US. Basic things such as light bulbs, switches and rubbish bags are comically bad in quality, so you end up having to buy these things various times in the same time period.
Another very annoying thing are rates and taxes people choose to add without any regard to the law. The other day my real estate agent added a 5% fine to my overdue rent (I already had a fine). When I said I would not pay another fine, they said nothing and accepted the correct amount.
My bank charged 37 reales fine which is illegal. When I complained, they gave it back.
Maybe life seems so expensive in Brazil because you are ALWAYS paying for things you shouldn´t be paying for.