Brazil said the government will continue to extend the tax exemption on sales of domestically produced cars until the end of this year to further motivate this key industry development.
This method is applied since May last year and has been extended four times. Most recent renewal effective date to 31/3 past to encourage auto manufacturing industry, one of the sectors most strongly affected by the international economic crisis.
Automobile consumption tax levied on domestic production is 2% for vehicles of less than 1.0 cubic centimeters (instead of 7% without reduction); 7% for vehicles from 1.0 to 2.0 cubic centimeters run gasoline alcohol-based (instead of 11%), and 8% for gasoline vehicles (instead of 13%).
For vehicles over 2.0 cubic centimeters, the tax rate is 25% for gasoline and 18% ethanol blended gasoline if the car runs. Meanwhile, the tax rate for truck remained at 0%.
The tax incentives allow Brazil to strengthen its position as the 4th largest automobile market in the world, but that the State revenue losses near 2.2 billion real (about 1.1 billion U.S. dollars) in the period from April to December this year.
One result of this policy is the last year new car sales in the South American country of over 3.8 million units, up 4.65% over 2011 and the highest level ever.
This is the sixth consecutive year the economy is the largest in Latin America set a record for the sale of cars and light commercial vehicles, with 3.6 million units.
Brazilian auto distributor Federation (Fenabrave) forecast renewal tax exemption will allow the auto industry to reach 3% growth this year.
Government tax exemption and to reduce inflationary pressure, which is expected to last the central bank of the country will be at 5.7% this year.
Auto industry accounts for nearly 25% of Brazil's total industrial output. The major car manufacturers operating in the country, including Fiat (Italy), Volkswagen AG (Germany), General Motors Co. and Ford Motor Co. (USA). /.
No comments:
Post a Comment