Brazilian import tax reduction for ITC and industrial equipment and machinery

Through its International Trade Chamber (CAMEX), the Brazilian government has released new resolutions reducing the import tax rates of 217 different types of industrial equipments and machinery not produced nationally.

As an attempt to promote domestic industrial and production growth, capital goods such as engines, pumps and machines, and several products for the ITC sector have had their import tax rates reduced from 16% down to 2% through the special customs regime Ex-Tarifário.

The special regime allows temporary import rates reduction of manufactured items which are not produced by the national industry. Private initiative can also file requests for specific products.

The complete list of the applicable NCMs and further legislation are available in the Portuguese language through the following links:

Special customs regime for the Oil & Gas industry in Brazil

The special Brazilian customs regime REPETRO allows companies to import specific equipments to be used in research and exploitation of oil and natural gas fields, with the exemption of federal taxes such as the following:

  • II – Import tax;
  • IPI – Excise tax;
  • PIS – Contribution to the social inclusion program;
  • COFINS – Contribution to the social security financing;
  • AFRMM – Additional freight for the renewal of the merchant navy.

The goods which REPETRO may be applied to are listed under the sole appendix of the Normative Resolution RFB 844. The resolution determines the general ruling of the special fiscal regime, including licensing requirements and conditions.

In general, the regime may be applied to a) Fictitious exporting of equipment, when it is bought from a national supplier by a foreign company in order to be used in national territory. In this case, the product is re-imported under “temporary admission” conditions; b) Temporary admission to products bought from national suppliers by the national licensee; and c) The Drawback regime, applied to the importing of industrial supplies for the production of goods destined to fictitious exporting.

Further legislation details may be found at the following Federal Reserve site: