SP extends tax exemption for the industry
O Estado de S. Paulo
The Government of São Paulo has extended until June 30 the exemption of the State Sales and Services Tax (ICMS) on the purchase of machinery and equipment imported without a similar national for 119 industrial sectors. The Government has also enacted an executive decree that extended until June 30 the return of the credit resulting from the ICMS in the acquisition of machinery and equipment, manufactured by São Paulo based companies, made immediately and in a single installment. The purpose, says Governor José Serra (PSDB), is to stimulate investments, increase and modernize the Manufacturing Complex of the State. The Governor pointed out that the measure also aims at stimulating the generation of jobs.
By means of the Decree, which is in force since February, the Governor has extended the benefits on the purchase of machinery and equipment both imported and made in São Paulo to 24 new industrial segments, amounting to a total of 143 sectors benefited with the release of the tax burden over the investment. Among the sectors included are the manufacturers of adhesives, gunpowder, matches, catalysts, tires, hydraulic equipment, engines, valves, compressors, bearings, bodies, trailers and cabs for trucks and buses. The criterion used for the inclusion of such sectors was the potential for job openings. According to the State Secretariat of Finance, nearly 90 thousand companies may benefit from the measure. The benefited sectors account for nearly 1.2 million jobs in the industry of São Paulo.
Another decree extends until March 31, 2011 the reduction of the ICMS tax rate from 18% to 12% for industries of sectors such as textiles, leather, wine, perfumes, toys, personal hygiene products, dairy products and vegetable oils, among others. The Government has also extended until March 31, 2011 the extended period of 60 days, not including the month for the payment of the ICMS under the system tax substitution. The sectors of medicines, alcoholic beverages, animal feed, cleaning products, autoparts, batteries, light bulbs, paper, toys and others benefited from the measure. This is the only measure that does not correspond to a tax waiver.