Reducing the import tax is a sign of liberalization, says former secretary

Last Friday (5), the federal government announced a temporary 10% reduction in the Import Tax rates on a large part of purchases made by the country abroad. The measure covers about 87% of the country’s tariff universe, and will be valid until December 31, 2022.

In an interview with CNN this Sunday (7), former Foreign Trade Secretary Welber Barral stated that the measure is a signal from the government for trade liberalization.

“The government had been trying for a long time to negotiate with other Mercosur partners a greater cut in the common external tariff. The cut is very small, 10% is a cut that will have an effect on some industrial commodities, on products that have a large volume of imports, but which will not have an impact on most imported products,” he said.

Welber also stated that this action is an attempt to fight inflation. “The world is going through an inflationary process due to energy and fuel prices. [A redução] it may have an impact of generating greater competition in Brazil, mainly in industrial commodities, which are the bulk of Brazilian exports,” he said.

The former secretary spoke about the advance of the reduction of the common external tariff made by Brazil. “These tariffs apply to exports made outside Mercosur. In 2019, Brazil made a proposal to cut 50% of the tariff and there was great resistance, mainly from Argentina.”

Brazil will insist on more trade liberalization in the future, but it is not a simple process, it is a process that affects industrial chains and affects competitiveness. There is a lot of pressure from Brazilian sectors that have higher costs than in other countries, all these processes will have to be analyzed

Welber Barral, former secretary of Foreign Trade

(*supervised by Juliana Alves)