Import taxes on ethanol, six foods slashed to zero in Brazil

Until the end of the year, ethanol and six food items will not be taxed upon entering Brazil. The move was unveiled by the country’s Ministry of Economy. The tax will be zero as of Wednesday (Mar. 23).

The measure benefits coffee, margarine, cheese, pasta, sugar, and soy oil. For ethanol, the tax rate was brought to zero both for ethanol blended into gasoline and for ethanol sold separately.

“We believe this could lead to a reduction in the price of gasoline of about BRL 0.20 at the pump. This is a static analysis. In practice, this measure will end up cooling the dynamic growth of such prices,” said Foreign Trade Secretary Lucas Ferraz.

As for foodstuffs, the Ministry of Economy stated processed products are weighing heaviest on inflation, as gauged by the National Consumer Price Index (INPC), which measures the impact of prices on lower-income families.

As it stands today, coffee has an import tax rate of 9 percent, margarine 10.8 percent, cheese 28 percent, pasta 14.4 percent, sugar 16 percent, soy oil 9 percent, and ethanol 18 percent.