The Brazilian government has decided to keep its rate of Tax on Industrialised Products (IPI) on cars, which was due to increase in April, unchanged, Finance Minister Guido Mantega said Saturday, according to the Brazilian press.
In a television interview the minister announced the decision to keep the current rates unchanged, which he said was intended to prevent a drop in automotive sales.
“The automotive industry is very important for the Brazilian economy, accounting for 25 percent of industrial production, and to ensure that industrial production increases it is necessary to ensure that automotive production increases,” said the minister.
The Brazilian government lowered IPI between 2008 and 2010 in order to drive vehicle sales and boost business during the first phase of the international financial crisis, the decision was applied again in 2012 and the rate was now returning to its normal level.
According to a government decision, IPI rates for cars will remain at between 2 percent for cars up to 1000cc and 8 percent for vehicles with engine sizes of between 1000cc and 2000cc.
For vehicles of over 2000cc, the rate remains unchanged at 25 percent for gasoline driven vehicles and at 18 percent for “flex” cars (that accept more than one kind of fuel). (macauhub)