Machine input fee zeroed
Folha de S. Paulo - 07/23/2008
After two and a half years, the government decided to resume the authorizations so that the national companies that supply machines and equipment to major infrastructure projects may import inputs without taxes and sell their products in the domestic market. The measure will also suspend the fines applied by the Federal Revenue on these operations since 2005. The MP (Provisional Executive Order) No 418, already converted into law in the end of June, put an end to the dispute that, according to the Mdic (Ministry of Development, Industry and Foreign Commerce), made it impossible for R$ 10 billion (US$ 6.25 billion) in investments and R$ 17 billion (US$ 10.63 billion) in exportations. Created in 1990, the "drawback" for the supply in the domestic market, as such mechanism is called in the technical language, has the objective of stimulating the supply of machines and equipment by the national industry for major projects. The Executive Officer of Abimaq (Brazilian Machinery Manufacturers Association), Hiroyuki Sato, evaluates the resumption of the "drawback" will be another benefit for the sector and its effects will mainly reflect in sectors such as cement, mining, paper and pulp and petrochemical. After the creation of the "drawback", the national suppliers stopped collecting taxes on the inputs and, like the imported goods, began paying taxes only when the machine or equipment is delivered.