Investment Incentive Policies

Tax incentives and exemption

To reduce production costs and stimulate economic growth, the State government offers several tax incentives that benefit a number of manufacturing sectors. Notable among them:

- Reduction of the Imposto de Circulação de Mercadorias e Serviços (similar to Sales Tax or VAT) (ICMS) from 18% to 12%. Products benefited: toys, leather and footwear, food products, cosmetics, among others.

- São Paulo Techno-parks System of (SPTec): use of credit acculturated from ICMS collected or subject to collection, for payment of items set out in the decree.

- Incentive Program  for Investment by Automobile Manufacturers (Pró-Veículo): allows use of credit accumulated from ICMS, collected or subject to collection, for payment of items set out in the decree by companies in this segment that present an investment program for modernization, expansion of industrial plants, construction of new plants, development of new products or expansion of their business in the State.

- Incentive Program for Investment by Manufacturers of Electronic Data Processing Products (Pró-Informática): use of credit accumulated from ICMS, collected or subject to collection, for payment of items set out in the decree by companies in this segment that present an investment program for modernization, expansion of industrial plants, construction of new units, development of new technology, new products or expansion of their business in the State.

- Incentive Program for the Railway Sector (Pró-Trens): suspension of ICMS levied on the import of goods without locally manufactured equivalents, as set out in the decree.

Other benefits are also conceded to white goods, Medium Density Fiberboards and furniture, capital goods, medical and dental equipment, among others. All decrees can be accessed on the Secretaria da Fazenda do Estado de São Paulo (Sefaz) website.

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