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Brazil eliminates import tax on food to keep inflation under control

13 May 2022 11:37

BRASILIA. KAZINFORM - The Brazilian government has zeroed the import tax rate for seven categories of food products. The decision was taken by the Foreign Trade Chamber (Camex) which is part of the Ministry of Economy. It enters into force today (Apr. 12) and expires on December 31, Agencia Brasil reports.

Among the products are boneless and frozen beef - whose tax was 10.8 percent; wheat flour - 10.8 percent, and grain corn - 7.2 percent.

The Ministry of Economy has reported that the impact caused by the tax waiver could reach BRL 700 million ($ 136 million dollars) by the end of the year. There is no need for tax compensation, as it is a market regulation tax, not a collection tax.

In a press conference on Wednesday (Apr. 11), executive secretary of the Economy Ministry Marcelo Guaranys said the purpose of the measure is to keep inflation under control.

«We know these measures do not reverse inflation, but they increase the contestability of the markets. When the price of a product starts going up too fast, there is always a greater possibility of importing it. That´s why businessmen think twice before increasing the price so much. This is the logic behind this instrument,» Guaranys said.

In April, the Brazilian National Broad Consumer Price Index (IPCA), which gauges the country’s official inflation, stood at 1.06 percent. It was the highest index for April since 1996 (1.26%). According to the government´s statistics agency IBGE, which calculates the IPCA, inflation in the last 12 months stands at 12.13 percent.

Keywords: World News,