Industry Set to Lose US$ 1,03 billion in Federal Fiscal Incentives

01/11/2017 - 13h17

The Brazilian Government may not renew fiscal incentives totaling R$3,3 billion (US$ 1,03 billion) by 2018. Among the sectors most affected are vehicles, civil construction, fertilizers and audio-visual.

The Finance Ministry is working under the general premise of not renewing incentives that have already expired, which would help to increase federal tax receipts. However, no final decisions have yet been made on a case-by-case basis.

All in all, there are a total of 15 types of exemptions set to expire in 2018, along with other governmental programs.

This year, the primary incentive program scheduled to expire is Inovar-Auto, responsible for total tax exemptions estimated at R$1,2 billion (US$ 375 million).

Although there has been no official confirmation, the Folha has learned that the automotive sector is prepared for the end of these incentives and is negotiating a new set of policies.

In 2016, incentive programs totaling R$3 billion (US$ 937 million) weren't extended or renewed.

In the government's evaluation, many of these measures haven't proven to be very efficient or effective and therefore are dispensable during times of fiscal austerity and concern.

Translated by LLOYD HARDER

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