MercoPress. South Atlantic News Agency

Brazilian VP says tax reform key to reindustrialization

Brazil needs to become “the great protagonist of the global decarbonization process,” Alckin also said

Brazilian Vice President Geraldo Alckmin insisted Tuesday that reshaping the country's tax scheme was vital to the reindustrialization of South America's largest economy.

Alckmin made those remarks upon being sworn in as Minister of Development, Industry, Commerce, and Services.

Under former President Jair Bolsonaro, some of the areas to be handled by the new agency were under the scope of the Economy Ministry, Agencia Brasil explained.

During the ceremony at the Planalto Palace, Alckmin spoke for almost half an hour, listing the challenges to the country's industrialization and his duties as minister which he will discharge in addition to those of vice-president.

“The moment requires us to work tirelessly for employment and income distribution, supporting industry, commerce, and the service sector,” said Alckmin. He added that the success of the Brazilian productive sector required simplifying the rules of the tax system in order to favor national competitiveness.

“The strengthening of our industry invariably goes through the reduction of the Brazil cost and the improvement of the business environment in the country. In this context, tax reform is fundamental,” said Alckmin while stressing the need for government unity. “The effort to reindustrialize Brazil, to further improve our agribusiness and the entire industrial park, adding more value to it, and to include Brazilian workers in our economy, are not episodic tasks, but a work of the entire government committed to a better and fairer future for our people.”

Alckmin argued that after having induced the country's economic growth during most of the 20th century, the Brazilian industry started to lose ground in the 1980s when it accounted for about 20% of the Gross Domestic Product (GDP) until reaching the current situation. In 2021, Brazilian industrial production accounted for 11.3% of the wealth generated in the country. Despite this, the sector accounts for 69% of everything that is invested in research and development in the country and for about one-third of tax revenues.

“Brazilian industry urgently needs to resume its protagonism, expanding its participation in the GDP. The serious climate changes, the post-covid and the war in Europe [between Russia and Ukraine] indicate the urgency of a reindustrialization policy consensual with the productive sector, academia, society, and the international community,” said Alckmin, highlighting the potential for Brazil to become “the great protagonist of the global decarbonization process,” as long as it invests in innovation and research.

“The sustainability agenda is a priority, even to guarantee the competitiveness of the national product in world trade,” said Alckmin, as he pledged to implement the “new Brazilian industrial policy” in partnership with Marina Silva's Ministry of Environment.

(Source: Agencia Brasil)