MercoPress. South Atlantic News Agency

Brazil lifts import taxes of foodstuffs to lower inflation

The measure is temporary, Alckmin explained

Brazil's Chamber of Foreign Trade's (Camex) Executive Management Committee (Gecex) gave its nod Thursday to the temporary removal of import taxes on nine food items to lower prices for local consumers. The tax exemption applies to boneless frozen beef, roasted and unroasted coffee beans, corn (not for sowing), certain uncooked pasta, cookies, extra virgin olive oil, crude sunflower oil, cane sugar, and preserved sardines (limited to 7,500 tons). Taxes ranging between 7.2% and 32% have been lowered to 0% in a move to curb inflation. The measure is effective starting Friday. Authorities insisted it would only be for a limited time.

The list of items with zero tariffs has been published in accordance with the Southern Common Market (Mercosur) Nomenclature (NCM) codes which has nine types of food divided into ten NCMs because the reduction for coffee benefits the roasted version and the unroasted bean version, it was explained.

Brazilian Vice President and Minister of Development, Industry, Trade and Services, Geraldo Alckmin, announced that the reduction will come into force this Friday (14), when the Camex resolution will be published in the Federal Official Gazette (Diário Oficial da União).

In the case of sardines, the zero rate will only apply to an import quota of 7,500 tons. As announced last week, the import quota for palm oil was increased from 60,000 to 150,000 tons for 12 months, with the import tax rate remaining at 0%.

Alckmin also announced that the zero tariff will have an impact of US$ 110 million per year on the country's coffers. However, he reckoned that the damage would not be that high because the measure would not last that long. “As I expect [the zero import tax] to be more transitory, the impact should be less,” he said.

(Source: Agencia Brasil)