Brazilian Official Announces the Termination of Import Tax Exemption for Electric Vehicles

17 Sep, 2023

Brazilian Official Announces the Termination of Import Tax Exemption for Electric Vehicles

Brazil is set to phase out tax exemptions for electric vehicle imports, gradually increasing import duties to 35% over a span of three years, as disclosed by Uallace Moreira, an official from the Ministry of Industry. This move, which has gained support from domestic automakers, comes after negotiations with Chinese manufacturers who market electric vehicles within the country. However, precise details are still under discussion, and the timing of implementation will be determined by Industry Minister and Vice-President Geraldo Alckmin.

Moreira emphasized the aim of encouraging local production by making imports more challenging and costly, citing similar protectionist policies adopted by several other nations in the sector. This decision aligns with the government's strategy to boost private investment in green technology.

To avoid market disruption, the tariff adjustments will be phased in gradually. Furthermore, within 15 days, the government plans to introduce a temporary measure to launch the second phase of the "Rota 2030" program, renamed the "Green Mobility Program." This initiative will incentivize energy-efficient projects through tax credits and introduce a concept called "green taxation." The proposed plan will adjust the collection of taxes on industrial products based on factors such as vehicle energy efficiency, the recyclability of products, and the density of local production."