20% tax rate for imports up to US$50 passed in the Senate; the measure increases federal revenue
The Minister of Finance, Fernando Haddadpraised Congress this Friday (June 7, 2024) for advancing the bill that stipulates a 20% tax on imports up to US$50. According to him, the Legislature “the debate evolved”.
“The important thing is that Congress got involved in the debate. There have been many years in which this topic was simply removed from public debate. And this subject was not discussed”, told journalists at the office of the Ministry of Finance in Sao Paulo.
Taxation could inject up to R$1.3 billion into federal revenue in 2024 from July onwards, according to Warren Rena’s calculation. The estimate is that the impact for 2025 will be R$2.7 billion.
Haddad is in favor of taxation because it helps with his objective of eliminating Brazil’s deficit and balancing public accounts in 2024. In practice, it is necessary to cut spending and increase revenue.
The project that brings taxation was approved on Wednesday (June 5) in the Senate. Now, it goes back to the Chamber for analysis.
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The minister once again linked the federal exemption to international “shopping” with smuggling. He argued that there is unfair competition between international retailers and Brazilian companies, which have a higher incidence of taxes. He mentioned negative impacts, such as unemployment.
“This government has not swept a problem under the carpet. On the contrary, it swept and exposed and sent all the arguments from side to side to Parliament.”he said.
Haddad strongly defended the taxation of cheaper imports in 2023. He tried to end the tax benefit. However, there was a negative reaction from the population. Buying products, especially clothes, from Chinese retailers has a strong appeal among the population.
After pressure – especially from the first lady, Janja – the idea of taxation was put aside in 2023. The advancement of the issue in Congress is good news for the Ministry of Finance.
During his speech, Haddad especially praised the actions of the presidents Arthur Lira (PP-AL), from the Chamber, and Rodrigo Pacheco (PSD-MG), from the Senate.
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