Problems relating to Trade and Investment on Brazil
9. Restrictive export/import trade, duty, and customs clearance |
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Issue |
Issue details |
Requests |
Reference |
| (1) High Import Duty | - Due to the high tariff on cameras, many smuggled goods entering from neighbouring countries disrupt the normal distribution activities. In many cases, travelers on their return trip smuggle them in as accompanying goods. - Compared to locally manufactured products, GOB levies high import duty in the range of 12-20% on electric products of various kinds that are imported and sold in the domestic market. - While many countries levy import duty on inkjet printers, high duty rates impede business operation especially in the following 2-countries: -- Brazil: Printer main unit: 16%, Printer consumables: 0% -- Argentina: SFP of less than 30 ppm: 16%, SFP of over 30 ppm: 2%, MFP: 12%, Printer consumables: 0% - While single function projector (being an ITA product) attracts zero import duty, in some countries, multi- function projector is dutiable at high rate of import duty. - High import duty levied upon imported car parts. - While GOB lifted import control on food products from Japan, import duty remains high. - High tariff levied on imported cosmetics, tightening profits. - Due to the extremely high import duties and the complex tax levy scheme on construction machines, imported goods have lost their competitive edge on price. |
- It is requested that GOB refrains from raising the tax rates triggered by the import tariff reductions. - It is requested that GOB reviews the tax rates. - It is requested that GOJ: -- takes action for solution of the problem, -- ascertains the latest information for expansion of the scope of products subject to ITA, and -- provides information continuously on the future trends worldwide. - It is requested that GOB takes steps to review the adequacy of the import duty level. - It is requested that GOB works toward repeal of import duty. - It is requested that GOB: -- makes transparent its taxation system, and -- reduces tax rates. |
- MDICE "General Foreign Trade System" - Brazilian Taxation System |
| (Action) - GOB protects the information and communication technology and products by imposing relatively high import tariffs and providing subsidies. The import tariff rates are 20-24% in average on computer, printer, monitor, cellar phone, etc. - On 5 May 2010, in order to halt the sudden surge of car parts import, Ministry of Finance of Brazil announced to raise the import tariff on car parts back to 40% or to "the normal level" from the going rates of 14-18%, which had been applied as a measure to promote car manufacturers production in order to expand their export business. The new measure is aimed at reducing the foreign trade deficit on car parts (from USD2.5 billion in 2009 to estimated USD5 billion in 2010). To implement the new measure, it requires promulgation of the law. - On 7 December 2011, Mexican - Brazilian Negotiations for a Strategic Economic Integration Agreement began. - On 4 September 2012, GOB released its policy to raise import duty (the present tax rates are mainly in 10 to 20% range) by maximum 25% over 100-items, including steel products, drugs, petro-chemical products, tires, glass, etc. GOB intends to introduce such a raise until the end of September. - During 31 August and 1 September 2015, Keidanren (Japan Business Federation) and CNI (Brazilian National Confederation of Industry) convened the 18th Japan ? Brazil Economic Joint Conference, and released joint study report toward ratification of Japan ? Brazil EPA. It concludes, both Japan and Brazil need to start negotiation for ratification of Comprehensive EPA including 11-fields of Trade on Goods. http://www.keidanren.or.jp/policy/2015/074.html |
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| (Improvement) - On 13 September 2012, CAMEX reduced Import Tariff Rates on certain Technical and Capital Goods. (CAMEX Decisions Nos. 68 and 69). - On 17 September 2013, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on Information Technology, Telecommunication and Capital Goods (CAMEX Decision Nos. 73 and 74). - On 23 October 2013, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on Information Technology, Telecommunication and Capital Goods (CAMEX Decision Nos. 88 and 89). - On 4 November 2013, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on Information Technology, Telecommunication and Capital Goods (CAMEX Decision Nos. 91 and 92). - On 27 December 2013, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on Information Technology, Telecommunication and Capital Goods (CAMEX Decision Nos. 119, 120, and 121). - On 17 March 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on Information Technology, Telecommunication and Capital Goods (CAMEX Decision Nos. 19 and 20). - On 9 April 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on certain Capital Goods (CAMEX Decision No. 23). - On 28 April 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on certain Information Technology, and Capital Goods (CAMEX Decision Nos. 34 and 35). - On 22 May 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on certain Information Technology, and Capital Goods (CAMEX Decision Nos. 37 and 38). - On 23 June 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on certain Information Technology, and Capital Goods (CAMEX Decision Nos. 43 and 44). - On 22 July 2014, CAMEX notified in the Official Gazette temporary reduction in Import Tariff Rate on Copper/Tin Alloy Plate (CAMEX Decision No. 56). - On 28 July 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on Carbon Steel (Thick) Plate, Information Technology, Telecommunication and Capital Goods (CAMEX Decision Nos. 57, 58 and 59). - On 12 August 2014, CAMEX notified in the Official Gazette temporary reduction in Import Tariff Rate on certain Crane Vehicle, etc. due to the supply shortage (CAMEX Decision No. 56). - On 12 September 2014, CAMEX notified in the Official Gazette reduction in Import Tariff Rates on certain Information Technology, and Capital Goods (CAMEX Decision Nos. 79 and 80). - On 19 December 2014, CAMEX reduced import duty rate on certain auto parts, information technology products and capital goods. (Resolutions n. 116/2014, 117/2014, 118/2014) - On 16 January 2015, CAMEX temporarily reduced import duty rate on products that had fallen in short supply (aluminium alloy plate, sheet and strip, etc.) - On 2 February 2015, CAMEX reduced to 2% import duty rate on certain information technology products and capital goods (Resolutions n. 7/2015, n. 8/2015). - On 9 March 2015, Mexico and Brazil agreed on 4-year extension of Auto Trade Agreement. - On 22 May 2015, CAMEX reduced import customs duty rate to 2% on certain information technology products and capital goods. - On 27 May 2015, Brazil and Mexico signed the Agreement of Economic Complementation (ACE No.53), while agreeing to start negotiation for upgrading ACE No.53 under Latin American Integration Association (ALADI= Asociacion Latinoamericana de Integracion). - On 22 June 2015, CAMEX reduced import duty rate on certain information technology products and capital goods (Resolutions n. 54 and 55/2015) - On 25 June 2015, Brazil and Argentina signed 41st Additional Protocol for the Agreement of Economic Complementation (ACE No.14); Extension until 30 June 2016 of the current Argentina and Brazil Car Trade Agreement (trade ratio 1.5 Flex Agreement, etc.) - On 1 September 2015, temporary reduction of import duty rate on information technology products, telecommunication equipment and capital goods (Resolution N.85 and 86/2015) - On 18 December 2015, CAMEX reduced import duty on certain information technology products and capital goods (Resolutions n. 116 and 117/2015) |
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| (2) Discriminatory Application of the Harmonised Tariff Classification | - Under the going Mercosur HS code scheme, a substantial difference in customs duty results from the device technology so that DLP projector (incorporating the U.S. manufacturer's core technology) classified under 8528.69.10. attracts 0% customs duty, while 16% customs duty applies to 3-LCD type DLP projector (incorporating the Japanese affiliated manufacturer's 3LCD core technology) classified under 8528.61.00. [Reference]: Current Mercosur HS Code: -- Of a kind solely or principally used in an automatic data processing system of heading 8471, 16% -- Other: 8528.69.10: --- With digital micromirror device (DMD) technology, free 8528.69.90: --- Other, 20% [Remarks]: DMD is also called DLP (Digital Light Processing) projector. |
- It is requested that Mercosur removes bias from its HS scheme. Harmonisation of import duty. | |
| (3) Complex and High Rates of Various Taxes on Imports | - While some imports are tax exempt, in addition to import duty, VAT, ICMS (tax on the circulation of products and services), industrial product service tax, service tax (in case of import of service), adding up to high cost in total. - Application is nebulous on various import duties, and the duty rates are extremely high. |
- It is requested that GOB either streamlines or removes tariff rates. - It is requested that GOB: -- streamlines the taxation system and -- reviews the import tariff rates. |
- Tax Law |
| (4) Antidumping Measures | - GOB imposed antidumping duty on cold-rolled stainless steel (from Japan, Spain, France, Mexico and South Africa) on 26 May 2000. -- The Review was due in May 2005. -- On 18 April 2006, negative dumping margin was found on Review as a result of review. - It seems antidumping measures will be instituted against isocyanate (materials for polyurethane compound) manufactured in Spain and Federal Republic of Germany in 2015. - Anti-dumping measures against glasses manufactured in PRC. |
- RESOLUCAO CAMEX 46 - Jul,4,2014 - CIRCULAR SECEX 59, Oct,10,2014 |
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| (Action) - In June 2007, CAMEX made affirmative finding to impose dumping duty on imports originating from PRC: on table fans (enforced on August 7, 2007, effective for 5 years maximum with definitive dumping duty of 45.24%), definitive dumping duty of US$4.82 per unit on electric iron, provisional dumping duty of US$2.75 per kilogram on speakers, and provisional dumping duty of US$14.49 per kilogram on comb (for hairs). - On 13 December 2007, Foreign Trade Chamber (CAMEX) promulgated in the Official Gazette its Decision No.66 to impose affirmative dumping duty on single loud speakers, NMC Tariff Classification Nos. 8518.21.00, 8518.22.00 and 8518.29.90, originating from PRC. This antidumping duty is valid for maximum 5-years from 13 December 2007. The dumping duty is US$2.35 per kilogram. - On 18 August 2010, CAMEX promulgated in the Official Gazette its Decision No.63 (Gazette Resolution No. 63 (http://www.jmcti.org/kaigai/Latin/index.htm)) of 17 August 2010 to impose antidumping duty on subassembly, components, parts and constituent parts of the product, which are subject to antidumping duty or countervailing duty and imported into Brazil from the third country(ies) (enforced on the same date) with the purpose of preventing the circumventing activities of the Brazilian trade relief measures. "The circumventing activities" as defined in the Gazette are: (1) Import into Brazil of subassemblies, components, parts or constituent parts which are used for manufacturing the identical products or products not identical in all respects but are closely resembling the products which are subject to the foreign trade relief measures, (2) Import into Brazil of products manufactured in the third country(ies) using the subassemblies, components, parts or constituent parts which are originating in the country(ies) subject to the foreign trade relief measures, and (3) Import into Brazil of products with slight changes made, without affecting the directions for use or final usage, or (4) All activities that obstruct execution of the foreign trade relief measures. Decision No. 63 de facto defines the substantive rules and the scope of the new anti-circumvention measures, provided, however, that, the procedural rules from filing application, execution and periodical review of the foreign trade relief measures have neither been promulgated by the Foreign Trade Secretariat (SECEX= Secretaria de Comercio Exterior) nor made known when it becomes available. Decision No. 63 has been promulgated in response to the domestic industry's complaint that the import from PRC has substantially declined while Chinese products are imported into Brazil by circumventing the foreign trade relief measures via third countries. According to GOB, products involved in the circumvention are footwear, hair brushes, bicycles, etc. - In 2013, Brazilian Ministry of Development, Industry, and Foreign Trade introduced new anti-dumping regulations. - On 4 November 2013, by Decision No. 94, CAMEX published its Final Determination for Levy of Antidumping Duty on Seamless Carbon Steel Pipe Originating from PRC. - On 22 April 2014, Ministerio do Desenvolvimento, Industria e Comercio Exterior (Brazilian Ministry of Development, Commerce & Industry) (MDICE) initiated Antidumping Circumvention Investigation on Carbon and Low Alloy Hot-Rolled Steel Sheet, manufactured in PRC and Ukraine. - On 18 June 2014, CAMEX published its decision to levy Provisional Antidumping Duty on Seamless Carbon Steel Pipe for Oil/Gas Pipeline manufactured in Ukraine. (CAMEX Decision No. 41) - On 20 August 2014, CAMEX published its decision to temporarily suspend Antidumping Duty on non-directional silicon electric steel plate manufactured in PRC, ROK, and ROC. |
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| (5) Unauthorised Triangular Trade | - GOB does not authorise a triangular (intermediate) trade, whereby imported goods are consigned directly to the customer, while the payment for cost of goods is settled through a subsidiary in Brazil. | - It is requested that GOB authorises the triangular trade. | |
| (6) Indiscriminate Import Duty Levy between New and Used Products | - Other than "books, pamphlets, magazines, clothing and shoes", GOB levies import duties (provided, however, that new clothing and shoes are taxable). | - It is requested that GOJ and GOB consider adjusting the classification to an adequate level. | |
| (7) Vexatiously Complex Import Regulations and Application Procedures on Used Machineries and Equipment | - In principle, GOB prohibits import of used goods, excepting the case where absence in Brazil of similar products is proven, in which event import is possible, albeit with vexatiously complex procedures. | - It is requested that GOB authorises import of used goods. | |
| (Action) - Prior governmental approval is required for import of used automotive vehicles manufactured prior to 1997. - It is practically impossible to obtain import license for used automotive vehicles. - Import of used vehicles is subject to non-automatic import license (Licenca Nao Automatica de Importacao) that requires attachment of Surveyor's Report, etc. to the I/L application form. - Secretetariat of Foreign Trade (SECEX) of the Ministry of Development, Industry and Commerce (MDIC) rejects virtually all applications for import of used automotive vehicles under Decree, Notification No.1991/8, Authorizing Import of Used Capital Goods on the ground that the Notification envisages import of used manufacturing capital goods. There is no express legislation that prohibits import of used automotive vehicles in the context of import regulations on used machinery and equipment. |
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| (8) High Cost of I/L Acquisition | - GOB collects the fee of 1.96% (which differs, commensurate with the rank graded by the total import parts amount) over the invoice price to cover the cost of I/L issuing, which is too high for a fee. | - It is requested that GOB reduces the I/L issuance fee. | - MDICE "General Foreign Trade System" |
| (9) Complex and Delayed I/L Acquisition Procedures | - Procedures of the I/L application filing are complex and time consuming. - It takes too long, from 2-weeks to 3-months, to obtain import licence from the date of filing application. Sometimes, a few days after acquisition of protocol number, in return for documental submission, GOB demands re-submission of documents. The flow of application procedures is nebulous. Because of this absence of transparency, extraneous expenses accrue, including without limitation, warehousing and storage at sea/air ports. |
- It is requested that GOB simplifies the procedures. - It is requested that GOB takes step to expedite import licence application procedures, to make visible the handling process, and to elucidate the examination basis. |
- Customs Regulation - MDIC (Ministerio do Desenvolvimento, Industria e Comercio Exterior) Circulars Nos.12/99 and 9/00 - MDICE "General Foreign Trade System" |
| (Action) - Prior filing of I/L application and its approval are necessary for import of goods into Manaus Free Zone. Filing of I/L Application may be completed by entering into SISCOMEX System, Exporter's Name, Product Name, Model/Type, Transaction/Payment Terms, Applicable Tax Incentives, if any, etc. on the Prescribed Form. |
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| (10) Vexatiously Complex and Delayed Import Procedures | - Upon import customs clearance of parts, it is necessary for importers to complete the invoice in Portuguese, including weight, material, manufacturer's name and price for each item, in addition to product name in Portuguese. This is time consuming and makes it impossible to respond quickly to the customer's needs in an emergency. - Customs clearance procedures are complex and extremely time-consuming. - Upon import of plastic moulds, it takes too much time for customs clearance and various other procedures. The required time varies from time to time so that MFS finds it difficult to plan ahead. After customs clearance, agricultural department's inspection follows. It likewise takes a long time. Due to the mentioned factors, a member firm switched to plastic moulded pallet from wooden pallet in order to save time. - At Manaus FTZ, it takes much time to withdraw the goods that arrive at the port. It is only upon completing all of the following procedures that the goods are finally released: 1) Check benefits 2) Check import control 3) Apply to bank for cargo withdrawal 4) Pay to Japan 5) Prepare paper to tax office 6) Check ICMS 7) Pay for boat cost 8) Payment of service fees 9) Tax office check - It takes a long time for a customs permit be granted after the cargo arrive at local ports (as follows), while the storage cost snowballs to the high amount: (The days shown below are approximate.) [Sao Paulo] -- By Sea: 10 days -- By Air: 7 days [Manaus] Waiting Period -- Green: 3 days (95%) -- Yellow: 6-7 days (2%) -- Red: 8 days (3%) - GOB requires ID card, taxpayer identification number for the customs clearance and the procedures are complicated. - Coping with emergency has been made difficult as customs' spot sampling inspection of imported cargoes takes much time. Spot check halts withdrawal of the entire cargoes for more than one week, despite the impeccable clean record on the part of the inspected importer. - The requisite documents for customs clearance differ by persons in charge at customs, so are the procedures that vary by customs personnel in charge, or by sea/air port(s). - The customs classification basis for judgement is nebulous upon import declaration. - Customs inspectors make false accusations. - After cargo arrival (at Manaus), it takes a week to 10-days (or more than 2-weeks at times). Moreover, customs employees' strikes have become an annual event, prolonging for more than a month in a worse case. - It takes too much time before the inspector in charge is appointed. During this period, no progress of cargo movement is observed under the customs system. Even after the starting customs inspection, both inspection items and length of inspection are at the mercy of each customs inspector. Prolonged inspection over a long period frequently occurs. As a result, importers incur extraneous cost sea/air ports for storage, etc. - Import procedures for samples of Japanese food products are extremely complex. |
- It is requested that GOB: -- streamlines the customs clearance procedure, -- improves the customs clearance procedure, -- repeals the requirement for item-by-item description of parts, and -- accepts also the English description of product names. - It is requested that GOB expedites the customs clearance. - It is requested that GOB streamlines its customs clearance including the procedures. - Makes nimble responsive action. - Narrows down the inspection items, taking care not to interrupt or halt the total production flow. - GOB takes step to have the laws amended to exclude to the extent possible customs inspector's personal views, and generate official written documents on the rules that relate to specific local circumstances. - For the sake of improving import customs clearance on subsequent shipments of similar nature, it is requested that GOB shows the basis of its determination. - It is requested that customs complete the customs clearance within 2-3 days. - It is requested that GOB sets up a section that deals with customs inspection measures with the view to expedite customs clearance procedures, and provides a broad guidelines on inspection items and corresponding inspection periods. - As regards products already sold in the Japan domestic market, it is requested that GOB: -- streamlines import customs procedures (more precisely, exempting, for example, anvisa inspection procedure), and -- simplifies the trademark registration procedures in Brazil (substantively, partial exemption of inspection procedures under Ministry of Agriculture, Brazil National Health Surveillance Agency (ANVISA), etc. |
- Customs Regulation - MDIC (Ministerio do Desenvolvimento, Industria e Comercio Exterior) Circulars Nos.12/99 and 9/00 - Instrucao Normativa SRF no 476 - Brazilian Customs General Dereto nr. 4,543 |
| (Action) - In January 1997, SECEX partially introduced the electronic trade document system (Sistema Integrado de Comercio Exterior "SISCOMEX). - Since March 15, 1999, GOB has streamlined export/import declaration on small value shipment, which makes it possible for importers to get the customs clearance by submitting a simplified import declaration (DSI). - WTO Trade Policy Review of December 2004 points out the Brazil now enforces non-automatic licensing requirements on about 35.8% of the tariff lines. - In October 2005, Customs strike continued for more than one month. Although essential goods were cleared through Customs, customs clearance was suspended on luxury goods and Christmas goods. - According to the Deloitte Survey Report, "International Trade--Challenge to Dissolution of Bureaucracy", 80% of 187 firms surveyed cited the difficulty in customs clearance (bureaucracy) as the largest barrier for processing foreign trade in Brazil, while 68% of the firms surveyed responded that 2-10 days are required to complete the customs clearance. - At the Japan-Brazil Joint Committee on Promotion of Trade and Investment held in February and September 2009, Japan side brought up the issue for simplified import procedure for used machineries which is now extremely complex and procrastinated. Brazilian side expressed its appreciation of the problems. - On 12 January 2012, MDIC tightened import control on mobile phones by requiring Certificate issued by Anatel (Agencia Nacional de Telecomunicacoes) before import, in order to restrict import of "low quality" mobile phones. The measures entered into force on 25 January 2012. - In December 2014, Brazilian Federal Revenu released initiation of Authorized Economic Operator (AEO) scheme. [Reference:] Brazilian Federal Revenu Normative Instruction n. 1,521/2014 at: http://normas.receita.fazenda.gov.br/sijut2consulta/link.action?idAto=59000&visao=anotado |
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| (Improvement) - In 1998, National Tax Administration Agency established express customs clearance system (Linha Azul or Blue Line). - Since 1999, GOB implemented a simplified customs declaration system for handling goods in small amounts (not more than US$10,000) such as export of spare parts, and re-export of temporary imports. - Under IN445/04 and ADE10/04, GOB legally mandates for handling export/import procedures in Brazil the use of SISCOMEX, which is a computerized integrated trade system (CITS) maintained by the Trade Administration Section (SECEX/DECEX) of the MDICE. Importers, customs brokers, banks, etc. are authorized to file computerized export/import customs clearance procedure by completing the importer/exporter registration (REI) and preparing hardware and software required for the electronic connection. - Enterprises importing raw materials in the amount equal to 40% of the assumed total export are authorized to take advantage of the cost saving drawback system incorporated into the CITS for exemption of import tariff, federal excise tax, federal Industrialized Product Tax (Imposto sobre Produtos Industrializados=IPI) and Merchandise Circulation Tax (Impostos Sobre Circulacao de Mercadorias e Prestacao de Servicos) (ICMS). - Enterprises with substantial export performance benefit from application of the "Blue Line" (Linha Azul), an expedited customs clearance category. - The use of SISCOMEX (Integrated Foreign Trade System) administered by DECEX (Department of Operations for Foreign Trade) of SECEX (Foreign Trade Department) for the Export/Import Procedures is a mandatory requirement under the law. Filing application for Exporter/Importer Registration (REI), and preparation of hardware/software, etc. for network connection to customs brokers, banks, etc. are all requisite steps to complete the export/import procedures by SISCOMEX. - On 5 October 2006, Federal Revenue of Brazil promulgated Ruling Regulation No.680 that streamlines import procedure and reduces import fees. The Regulation provides for new import customs clearance procedure such as automatic customs clearance by the quantitative confirmation. - The Ruling Regulation No.680 provides that the actual physical inspection of the customs officer may be replaced by the inspection reports such as: 1) Report or Inspection Certificate issued by the Customs Authority of the exporting country, or 2) Report and Inspection Certificate issued by the Import License Officer in charge or other authority. - On 4 April 2007, Federal Revenue of Brazil promulgated in the Official Gazette Ruling Regulation No. 731/2007 amending Article Nos. 19, 24 and 47 of Ruling Regulation No. 680/2006. This amendment stipulates, among other provisions, new customs clearance procedure for installment deliveries and early deliveries. - "SISCARGA" Electronic System on movement of goods during customs clearance has started its operation from 31 March 2008, in order to realize the bundling together of the control on 'movement of goods at Customs', 'movement of cargo vessels', and 'the tax levy system'. - The use of SICOMEX, an integrated computer system, which is maintained by Foreign Trade Department (DECEX) of Ministry of Development, Industry, Commerce and Foreign Trade (SECEX), is obligatory under the Brazilian law for filing export/import procedure, which can be made by prior exporter/importer registration (REI) with the authority and preparation of the requisite hardware/software, through the computer systems connected to SICOMEX, using the computer system of the applicant, customs broker, or bank. - In June 2010, GOB introduced "Paperless Port System" that will enable public and private sector organizations to share information related to export/import information across the entire logistics chain on-line, including 6 governmental agencies such as the port authority in order to cut down the number of days required for customs clearance. - In March 2014, FRB introduced Simplified Import Declaration (DSI) system applicable to imports in small amounts (corresponding to the amount less than USD3,000). |
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| (11) Stringent Penalty and Exorbitant Amount of Fines | - GOB compels payment of exorbitant amount of fines on careless mistakes made in the customs clearance documents and customs declaration contents. Delayed customs clearance. | - It is requested that GOJ induces GOB's prompting customs' improvement. | - Regulamento Aduaneiro Art. 702,703,706,711, 715,717,725,727,728, etc. |
| (12) Rampant Smuggling and Illicit Imports | - Due to the heavy tax burden imposed by GOB, including, Import Duty (II) 4-20%, Tax on the Circulation of Products and Services (ICMS) 7-18%, and Federal Sales Tax (PIS/COFINS) 3.65%, besides Industrial Product Tax (IPI), illicit imports are rampant, with incorrect quantities and amounts shown on customs declaration forms, etc. Despite the fact that import of the latest high-tech IT products is indispensable for promotion of the Brazilian industry, stale, used goods are sold by illicit dealers out in the open in the market as brand new, because of the various heavy taxes and regulations. - Illicit imports and smugglings abound of electronic products and equipment (in circumvention via Uruguay and Paraguay of Mercosur Member States, and by traffickers from Miami, the U.S.), due to a less-than- thorough collection of import duties, ICMS and IPI Taxes and other taxes and dues that injures development of the domestic industry in Brazil, because of the gap in cost and price from the legitimately manufactured, imported and distributed products. i.e., -- Personal computers, mobile phones, home electric appliances, office equipment. - Illegal imports are rampant. Especially, parallel imports of cheap products originating from Republic of Paraguay are in circulation in the Brazilian market. |
- It is requested that GOB: -- deregulates the heavy tax burdens, -- makes redoubled efforts thoroughly and completely in clamping down on the illicit imports and illicit products. - It is requested that GOB tightens its clampdown on illicit imports, and smuggled products. - It is requested that GOB: -- tightens its clampdown upon parallel imports at the border, and -- gives seminars to customs officials. |
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| (Action) - The high tax rates are causing the rampant illegal imports of pirate editions in Brazil, with prices less than half of the legitimate products. GOB has developed a campaign focused on the young purchasers, inducing them to boycott the pirate editions. - Since 2005 in each year, GOB has participated in "Operation Jupiter" under collaboration of interpol and WCO, in association with police/customs/private enterprises of each country in South America to clamp down on counterfeits/pirating of copyrighted works. |
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| (13) Stark and Still Export Customs Clearance Scheme | - It is difficult to correct prices and change payment terms after shipment is made. | - It is requested that GOB streamlines the customs clearance procedures with more flexibility. | |
| (14) Disunity in Rules on Customs Clearance | - Due to the non-standardised Customs Rules, traders experience much difficulty in preparing the shipping documents for their customers in Brazil. To expedite customs clearance, it is necessary to use the Blue Line (Express Customs Clearance System). | - Measures such as provision of Blue Line are welcome to traders for improving the environment for further development of international business. | |
| (15) Disallowed C.I.F. Price Setting under Incoterms | - GOB does not accept price setting based on the CIF price, pursuant to INCOTERMS. | - It is requested that GOB accepts price setting based on the CIF, price under INCOTERMS. | |
| (16) Compulsion on Use of Special Packaging as a Requirement for Duty Exemption on Imported Products | - To encourage Education and Culture in Brazil, the Federal Constitution grants Tax Immunity to papers used for publication or educational purposes, such as books, newspapers, periodicals, and for writing (the Products). However, to expel the use of the Products for other purposes, GOB compels the use of packaging materials printed "PAPEL IMUNE". It frustrated export to Brazil of the products, as the requirement goes far beyond manufacturers' taking adequate responsive actions with ease. | - While GOB states the new requirement has been introduced for the purpose of improving the tax revenue, it is a question of whether the importers submit to the local legislative systems. It is requested that GOB reviews the new requirement, which compels manufacturers in exporting countries the use of a special packaging for the Products. The unilateral compulsion of the use of the special packaging is tantamount to action for expulsion of imports. | - RFB Normative Instruction NO.1341 |
| (17) Import Restrictions on Expatriates' Personal Cargoes | - GOB prohibits all foods, drinks and medication drugs as expatriates' personal cargoes. - After entry, expatriates must personally keep the AEO air-ticket stub, pending completion of customs clearance on personal effects moved from their home country. |
- It is requested that GOB considers optimizing the level of AEO (Authorised Economic Operator). | |
| (18) Exhorbitant Storage Charge of Bonded Warehouse at Sea/Air Port Terminals | - AEO bonded warehouse operation subject to public tender, operators have no alternative but charge high storage (based on CIF price) to customers. | - It is requested that GOB considers reduction of warehousing charge at AEO sea/airport terminals. | |
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