RIO DE JANEIRO, BRAZIL – The Brazilian federal government issued a decree that reduces the rates of industrialized products listed in the Tax Incidence Table of Industrialized Products (TIPI). The measure changes the previous decree, published at the end of last month, which deals with the same subject. The changes are effective as of May 1.
According to the government, the measure published on April 14 in the Official Gazette of the Union (DOU) seeks the adequacy of the rates of the table for this year concerning what was established in a 2017 decree, “promoting the maintenance of the general reduction of the IPI rate in 25% for most products.”
The government justified the reduction with the argument that the measure aims to stimulate the economy, affected by the covid-19 pandemic, to assist in the country’s economic recovery.
According to the government, the changes represent a tax burden reduction of R$19.5 billion (US$4.2 billion) for the year 2022. In the following years, the estimated reduction will be R$20.9 billion for 2023 and R$22.5 billion for 2024.
“Because it is an extra-fiscal tax, of a regulatory nature, the presentation of compensation measures is not required, as authorized by the Fiscal Responsibility Law,” informed the General Secretariat of the Presidency of the Republic.
With information from Agência Brasil