Brazil, the leading economy in Latin America, plans to bring back taxes on imported electric and hybrid vehicles.
This change will start next year and increase gradually until 2026. The aim is to encourage local car manufacturing.
The Ministry of Development, Industry, Commerce, and Services released a statement. It said the tax will help grow Brazil’s car production sector.
It will also reduce the country’s car emissions. The tax will start in January 2024. It will slowly go up to 35% of the import value by July 2026.
This period matches President Luiz Inácio Lula da Silva’s current term.
The Executive Steering Committee of the Foreign Trade Chamber (Camex) approved this decision.
State-run news agency Agencia Brasil reported that Camex will also bring back import taxes on 73 chemical products. These taxes were 10% lower since May last year.
The ministry explained that these steps aim to protect Brazil’s industries. They address the challenges caused by a big increase in imports and changes in prices.
Background
Historically, Brazil has focused on developing its local industries. The government often uses taxes and import regulations.
These tools help protect Brazilian businesses from foreign competition. In the past, Brazil has had high import taxes on many products.
This strategy aims to encourage local production and create jobs. Brazil has a large automotive industry. It is crucial for the country’s economy.
The industry has seen growth over the years. However, it faces competition from imported vehicles.
Reintroducing these taxes is part of Brazil’s long-term economic plan. This plan balances environmental goals with industrial growth.
The government believes this strategy will benefit Brazil’s economy and environment.
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