Brazilian authorities approved raising import taxes on 29 chemical products
The request for the tariff hike was submitted by the Brazilian Chemical Industry Association (Abiquim), which represents local chemical producers in March, citing the need to counteract aggressive foreign competition.
On 18 September 2024, Brazil's Chamber of Foreign Trade approved a significant increase in import taxes on 29 chemical products, a move designed to shield the domestic chemical industry from an influx of cheaper imports. While the government frames the decision as necessary for protecting local producers, critics argue it could have far-reaching economic consequences.
The proposed tariffs, which await approval from Brazil’s Mercosur partners, would see rates rise to as high as 20%. If no objections are lodged within 15 days, the measure will be formalized and published in the Official Gazette.
Affected petrochemical products are:
|
Product |
Current Import Tax |
New Import Tax |
|
Polypropylene (PP) |
12.6% |
20% |
|
Polyethylene (PE) |
12.6% |
20% |
|
Polyvinyl Chloride (PVC) |
12.6% |
20% |
|
Expandable polystyrene (EPS) |
12.6% |
20% |
|
polyethylene terephthalate (PET) |
12.6% |
20% |
The request for the tariff hike was submitted by the Brazilian Chemical Industry Association (Abiquim), which represents local chemical producers in March, citing the need to counteract aggressive foreign competition. However, the decision has faced strong opposition from the plastic industry, which warns that the increased costs could stifle growth and harm local businesses.
Despite these concerns, the government insists the affected products will be subject to monthly monitoring and potential reassessment, but some industry insiders question whether this will prevent the damage critics fear.
Written by: Rochelle Nguyen