WITNESS-Bureaucracy mindbend: Brazil taxes my busted microwave

* Bureaucracy costs "waking giant" some ${esc.dollar}26 bln per year

* Thousands make a living off signing, stamping, sealing

* Tradition dates back to era of Portuguese colony

By Brian Ellsworth

RIO DE JANEIRO, Nov 21 (Reuters) - I was hoping to leave my old broken microwave behind when I leave Brazil this month, but the government is not having any of it.

My moving company says because I brought it into the country when my wife and I moved here in 2009, authorities will levy a tax of almost double its original value if I leave the country without it. Whether or not it still works.

Unfortunately, my movers tell me, I&${esc.hash}39;m not going to escape paying that tax for the 10-year-old television that I brought with me to Rio; we gave that away last year after buying a flat-screen to watch the World Cup.

And once our belongings are packed up, they may have to wait almost two weeks before even getting to customs so that cultural authorities can review our framed paintings.

They need to make sure the artwork, including a painting done by my wife of the Venezuelan capital of Caracas, does not include any misappropriated Brazilian cultural patrimony.

"We have to get a jump on this painting thing, it&${esc.hash}39;s a real hassle, like everything else in Brazil related to bureaucracy," said my mover with a laugh.

Stories of Brazil&${esc.hash}39;s mind-bending bureaucracy are often shoved aside in favor of hagiographic descriptions and catch-phrases like the "waking giant," the "emerging market power," or the "future breadbasket of the world."

You&${esc.hash}39;re less likely to hear about this bureaucratic machine, a maze of taxes and arbitrary rules estimated by Sao Paulo business group FIESP to cost the economy 46 billion reais (${esc.dollar}26 billion) per year. It is a brake on everything from job creation to infrastructure projects needed for the upcoming 2014 World Cup soccer championship and 2016 Olympic Games.

I would hardly say this dented the quality of life in Brazil, which remains one of the most fascinating places I&${esc.hash}39;ve had the pleasure of living in.

And at times I&${esc.hash}39;ve found myself responding to absurdity with an adopted Brazilian shrug and the phrase "Fazer o que?," or "Oh well, what are you gonna do?"

Other times, like the last week when I&${esc.hash}39;ve been racing against the clock to get everything in order before I leave the country, it has made me want to tear my hair out.

THE BUSINESS OF GOVERNMENT

Brazil has for decades failed to simplify administrative transactions, in part because the tradition of slow-moving government is older than the country itself.

In the early 19th century, when Portugal&${esc.hash}39;s King Joao VI ran the royal court from Rio de Janeiro after fleeing Napoleon for Brazil, officials in Lisbon would wait months for documents as they were shipped back and forth across the Atlantic.

The country&${esc.hash}39;s 1964-1985 military dictatorship recognized the problem but proposed a solution that for obvious reasons made matters worse: it opened a special agency called the Extraordinary Ministry of Debureaucratization, today still the butt of jokes about Brazil&${esc.hash}39;s bureaucratic morass.

In a country that is a world leader in biofuels production, agricultural innovation and deep-water oil exploration, the resilience of its paper-pushing legacy is a stark reminder of "Old Brazil," the hyper-inflationary economic basket case for years passed off as being eternally the country of the future.

That bygone era feels alive and well at the ornate Foreign Ministry office in downtown Rio, with its marble floors and iron bust statues of independence heroes, where travelers come for official seals on all manner of paperwork.

I had to bring the manifest of my household goods shipment for a stamp that would authenticate the notary&${esc.hash}39;s seal, which in turn authenticated the validity of my signature.

As I stood in line, a cross civil servant told a crestfallen young man in front of me that he would have to come back another day because his document was notarized in the state of Minas Gerais. It had to be notarized again in Rio.

Bad news for him, but good news for the country&${esc.hash}39;s network of 15,000 privately run "cartorios" or notaries. Some of them make millions of dollars per month in fees, much of which is generated by state-mandated certification.

Brazilians&${esc.hash}39; efforts to negotiate these hurdles frequently rely on a network of "despachantes," informal workers who for a fee will obtain anything from drivers&${esc.hash}39; licenses and visas to export permits and customs clearances.

This cadre of people making a living off the byzantine and often counterproductive requirements forms a powerful lobby that ensures the system doesn&${esc.hash}39;t change by pressuring public officials not to streamline paperwork.

Brazil&${esc.hash}39;s history of hyperinflation and corruption have led to such stringent regulations over money that basic transactions can take on an almost prudish quality.

To pay ${esc.dollar}70 in consular fees, I had to buy dollars that were not stained or folded and did not belong to the 1998 or 2008 series. When I could only find twenty-dollar bills in those specifications, leaving me with ${esc.dollar}80, the bank refused to complete the transaction, perhaps giving new meaning to the phrase "exact change."

After days of fighting with officials and juggling arbitrary and nonsensical rules, I decided to seek a way that Brazilian bureaucracy can work for me.

Because Brazilian law requires income taxes be paid each month but prevents Reuters from doing so on my behalf because of an obscure visa provision, I&${esc.hash}39;m trying to convince the company to fly me back to Rio for a week so I can pay income taxes in person.

I don&${esc.hash}39;t think management is going to fall for that one, but it&${esc.hash}39;s worth a shot. (Editing by Kieran Murray)