Bolsonaro Eliminates Import Tax on 281 Items

Measure Taken by President Jair Bolsonaro Facilitates Purchase of Capital Goods and IT and Telecommunications Without Domestic Production.

The approval by the government of Jair Bolsonaro corresponding to 281 tariff exemptions for machines and equipment without production in Brazil took place this Friday, August 2, by the Undersecretariat of Foreign Trade and International Affairs (Secint) of the Ministry of Economy (ME). The reduction already encompasses 1,189 products to encourage investments.

The measure taken by the government temporarily eliminates the import tax rates for 261 capital goods (BK, according to the Common External Tariff nomenclature of Mercosur) and 20 IT and telecommunications goods (BIT).

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The reduction is included in two ordinances from Secint published today in the Official Gazette of the Union (DOU). The Ordinance No. 510 reduces the rate from 14% to zero for 261 BK, including 240 new and 21 renewals. Meanwhile, the Ordinance No. 511 establishes 20 new tariff exemptions for BIT, which will have the rate reduced from 16% to zero.

According to the Undersecretariat of Commercial Strategy of the Executive Secretariat of the Chamber of Foreign Trade (Camex) of Secint, a total of 1,189 tariff exemptions for BK and BIT have already been granted in 2019. The goal is to promote the attraction of investments to Brazil, reducing the burden on investments directed to productive enterprises.

The Secretariat of Industry, Commerce, Services and Innovation (SDIC) of the Ministry of Economy carried out the procedures and analyses of the two ordinances in accordance with Camex Resolution No. 66/2014.

The procedures utilize the new criteria introduced by Ordinance No. 309/2019 of the Ministry of Economy, which expand the possibility of granting tariff exemptions, still pending regulation from SDIC.

Government Proposes Reduction of IPI on Video Game Consoles to 40%

This week, President Jair Bolsonaro used Twitter to announce promises regarding tax reductions for electronic games. In the draft of the decree, a reduction of IPI (Tax on Industrialized Products) charged for video game consoles from 50% to 40% is planned.

The Ministry of Economy believes that the tax reduction will stimulate the electronic games sector in the country – “the fastest growing segment in the entertainment sector worldwide.” On the other hand, the decrease in tax collection is expected to mean a loss of more than R$ 50 million for public coffers by 2021.

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