Brasília – The Brazilian Federal Revenue Service has broadened the special tariff regime to boost the export volume and encourage the industrialization of products in Brazil. Known as Recof, the regime allows tax-free imports of inputs to the country, as long as they are meant for the manufacturing of goods to be sold to foreign countries. It will be available to companies in any segment of industry, especially assembly.
According to the undersecretary for Customs and International Relations at the Federal Revenue, Ernani Checcucci, the Recof formerly benefited only certain sectors of the economy, such as telecom, computing, information technology, auto and aerospace. Presently, 26 companies are benefited by the tax exemption. The Revenue Service estimates that another 185 companies will be eligible for the Recof. Of those, 12 are apt to adhere to the new regime immediately.
“Our goal is to foster the export capacity by simplifying the requirements for adhesion to the regime. New eligible sectors include appliances, white line appliances, machinery and equipment, optical devices, tools, weapons, prefabricated construction, and the naval industry, which includes ships and rigs,” said the undersecretary.
Checcucci also said that in order to participate in the new tariff regime, companies must export a minimum of US$ 10 million per year. Prior to the changes to Normative Ruling 1,291, issued this Friday (21st) on the Official Gazette, the limit varied from segment to segment.
“The Recof is systemic, it demands companies to meet export and import requirements, and to develop cooperative systems which abide by Federal Revenues regulations,” he explained.
According to the Federal Revenue Secretariat, trade operations involving companies benefited by the Recof amounted to approximately US$ 21 billion in 2011. After the newly added segments, the figure is expected to go up to US$ 29 billion. For Checcucci, the Recof “has an exclusive monitoring system” under which companies are obliged to meet all export volume requirements.
*Translated by Gabriel Pomerancblum
