São Paulo – Brazil’s president Jair Bolsonaro sanctioned this Friday (25) Law 14,060, which allows for the exceptional extension of duty drawbacks for one year. Drawbacks enable the suspension, exemption or lifting of duties on imports or domestic purchases of inputs employed or consumed in the processing of products for export.
According to the Ministry, these drawbacks lend greater competitiveness to Brazilian exporters. The new law builds on Provisional Measure 960 (PM 960), from May 4, 2020, in line with federal government efforts to alleviate the effects of the Covid-19 pandemic on the national economy.
According to the Ministry, in addition to corroborating the original PM 960, which allowed longer terms for suspension drawbacks, the new law extends the same advantages to exemption drawbacks.
Secretariat of Foreign Trade (Secex) numbers show that USD 49.1 billion worth of exports relied on drawbacks last year. that amounts to 21.8% of total exports from Brazil. Some 2,000 companies are tapping into suspension and exemption drawbacks, in industries including iron ore, frozen poultry, wood pulp, chemicals, and automobiles.
Translated by Gabriel Pomerancblum
