Tax Incentives to Improve Brazilian Cars
October 5, 2012 Taxation in Brazil
BRASILIA – The automotive industry in Brazil will soon feel a renewed boost as the government sets its sights on helping car manufacturers through tax incentives.
In a press conference held in Brasilia on October 4th the Minister of Trade and Industry of Brazil Fernando Pimentel outlined several tax changes the government will implement starting from 2013 in order to improve the safety and efficiency of cars produced in Brazil, to increase demand for locally produced cars, and encourage development of automotive technology.
Tax incentives will be offered to national car manufacturers who implement modern safety technologies in their automobiles, and all new cars will be required to have ABS brakes and safety air bags as a standard fitting.
Tax allowances will also be granted to manufacturers who implement technologies to raise the fuel efficiency of new cars, with the Minister saying that car makers will be encouraged to refine technologies which will allow to decrease the average fuel consumption of the vehicles they produce by over 12 percent.
Currently Brazil is ranked as the 7th largest car manufacturer in the world, but, according to the Minister, the government hopes that the new tax policies will help increase production and become one of the five biggest producers in the world.
Photo by explainthatstuff