Brazilians lobby to raise import tax on wide range of products, steel and chemical sectors already benefited
Brazilian companies trying to protect their market against foreign competition have about two weeks to formally tell the government what it should include on a list that subjects products to higher import taxes, according to a resolution from Camex, the National Foreign Trade Council.
Adopting a new process, the Brazilian government began a public comment period that ends 11 March inviting companies and trade associations to suggest changes to import tariffs levied on products imported from outside of Mercosur, the five-nation customs union comprising Brazil, Argentina, Uruguay and Paraguay that was last year joined by Venezuela.
Mercosur countries have a Common External Tariff (TEC) which cannot surpass 35%, and the public comment period concerns two key lists of products that are subject to the TEC common import tax.
One is called the List of Exceptions to the Common External Tariff (Letec), which is comprised of 100 items and is reviewed every six months by the Mercosur members. An item can only be added to the list when another one is excluded, explained Fernanda Sayeg, a trade law specialist at Felsberg e Associados.
The second list subject to the public comment process is called List of Temporary Elevations to the Common External Tariff. This list was created to protect Brazil from the effects of the world economic crisis and contains 200 positions, 100 of which have been filled in October 2012, when the government identified items that should be subject to higher import tariffs, Sayeg explained.
The steel and the chemical sectors have requested the inclusion of several items on the list of temporary import tax elevations, according to the attorney. Because they were able to add many items on the first part of the list and received protection on the Letec list, they are unlikely to obtain more concessions from the government at this point, predicted the lawyer. “Competition is fierce to get an inclusion,” Sayeg explained.
The Brazilian government should close the 200-item list of temporary import tax increases by June, said Sayeg. The next step is sending the final list for other Mercosur members to approve, although rejections are not expected, Sayeg said, based on the experience building the first part of the temporary elevation list. The expectation is that the definitive list will be issued by August.
by Ana Mano in Sao Paulo
PaRR (Policy and Regulatory Report)
Competition Law – Global Intelligence
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