The reduction from 14% to 2% in the Import Tax on the purchase of machinery and equipment that is turned to the productive sector and has no similar products on the national market should continue up to the end of 2010.
The tax break was expected to end on December 1st. 2008, but it was extended by the Foreign Trade Board (Camex), an organization under the Ministry of Development, Industry and Foreign Trade.
According to the Camex, the Common Tariff Regime of the Mercosur (the Common Market of the South), allowing for automatic extension of tax benefits by the countries of the bloc, is about to be enacted.
On providing this information, the Camex secretary, Lytha Spíndola, said that in recent months the demand for the tax benefit has been growing, making it compulsory for the ministry to publish the list of products that benefit every month.
Camex had been publishing the list every six months, but, in recent months, the organization found the need to make it monthly due to the demand from businessmen, who are investing in capital goods.
Lytha Spíndola believes that this race to purchase machinery and equipment is positive in the social field, as it allows for the generation of jobs.
The list of items that may be benefited is produced in a partnership between the Camex and the Internal Revenue Service, the Ministry of Finance and several secretariats. The import fee levied on capital goods in general is 14%. Only electronic products and information technology and telecommunications equipment pay more.
On paying 2% Import Tax, the productive sector is also freed from paying the Industrialized Product Tax (IPI) and the value added state tax (ICMS).